Oral Answers to Questions

TREASURY

The Chancellor of the Exchequer was asked—

US Dollar (Depreciation)

Kelvin Hopkins: Whether he has made an assessment of the implications of the depreciation of the US dollar for the British economy; and if he will make a statement.

Gordon Brown: In the last six months, the dollar has fallen by 6 per cent. against the pound. At the same time, the euro rose by 5 per cent. against the pound. Our objective throughout is stability and the maintenance of economic growth. During our presidency of the G7 and G8 next year, our objective will be that each continent make its contribution to the sustained growth of the world economy.

Kelvin Hopkins: Is it not now clear that the Americans are using the dollar exchange rate as an explicit instrument of macro-economic policy? Given that Britain, too, has a substantial and increasing trade deficit, largely with the rest of the European Union, is it not only a matter of time before our Government must adopt an active exchange-rate policy as well?

Gordon Brown: I thought that my hon. Friend was opposed to a fixed exchange rate, especially given his views on the euro. Exchange rates will, over time, reflect the fundamentals of the economy. Given the volatility that there has been, I think it most important for each continent to consider over the next few months what contribution it can make to sustained growth in the world economy. I shall be meeting the American Administration over the next few days and will urge them to set a clear path showing that the current account and budget deficits can be dealt with. Equally, the European economy must contribute to growth in the world economy as it has not done in recent years. The same applies to the Japanese economy, which must continue its programme of financial sector reform. Given the present condition of the world economy, in which world trade is increasing, we need to see each continent contributing to both stability and growth.

Richard Ottaway: I am encouraged by that last reply. Is not the real implication of the devalued dollar—given that the foreign debts of many countries around the world are in dollars—the devaluation of those debts, which will have a profound impact on the world economy? Will the Chancellor address that when he talks to his colleagues in the United States?

Gordon Brown: I will certainly mention it when I talk to Mr. Snow, the Treasury Secretary, and Dr. Greenspan, chairman of the Federal Reserve. As policy makers, however, we must decide on the best way forward for the world economy. If we are to maintain the levels of growth achieved this year and see the world economy on a sustained path of growth over the next few years, it is clear to me that the European economy must grow faster. It is also clear to me that the current account and fiscal deficits in the United States must be seen to be addressed, and that in Asia, especially Japan, financial sector reform must be there to show that Japan is on a path towards growth as well.
	I do not think that in February we shall return to the sort of discussions we had at Louvre and Plaza in the 1970s. We shall be discussing how greater flexibility and stability in the world economy can make for greater growth.

David Taylor: In the mid-1980s, closing the twin fiscal and current account gaps in the United States, which at that stage were running at about 3 per cent. of gross domestic product, was associated with a 30 per cent. fall in the dollar when measured on a trade-weighted basis. Does my right hon. Friend agree that with those two deficits now running at about 5 per cent., the chief economist at the Bank of England was right to flag up further sizeable falls in the dollar recently? What will my right hon. Friend do about that prospect when he talks to the American Administration?

Gordon Brown: There is another factor to be taken into account. The European economy has been growing at half the rate of the American economy for about 10 years. If we are to have balance in the world economy, we shall need more growth out of Europe. Whether in terms of interest rates or of structural reform, the whole European area economy will have to grow faster. We are not in the position in which we found ourselves in the mid and late 1980s. We have low inflation both in Britain and in the world economy and we will not make the mistakes made by the last Conservative Government.

Oliver Letwin: The Chancellor is obviously right to favour floating exchange rates—I think that there is agreement on that throughout the House—but one point was not made clear in his reply to the hon. Member for Luton, North (Mr. Hopkins). Does he think that the depreciation of the dollar has been a major factor in the record trade deficits that the United Kingdom now has?

Gordon Brown: Of course the depreciation of the dollar is a factor affecting not just the British economy but economies around the world, but policy makers must deal with the real world as we find it. What we must think about over the next few months is how we can sustain the stability of the world economy and at the same time have the fastest growth possible, so that instead of the downturn of the past few years we enjoy a period of sustained growth. I am suggesting that each continent must recognise its responsibilities. Rather than looking at some academic analysis of what might have happened, we must look at what can happen. Each continent must say, "Here are the contributions that we can make to the continuing growth of the world economy." I should have thought there was common ground between us on that.

Oliver Letwin: I still did not hear the right hon. Gentleman explain the reason for the UK's record trade deficit. What about foreign direct investment in this country? Does he think that the depreciation of the dollar is mainly responsible for foreign direct investment dropping to a quarter of its level five years ago?

Gordon Brown: The right hon. Gentleman wishes again to talk down the British economy, but he should recognise that we are the premier country in Europe benefiting from foreign direct investment, particularly from Asia. The pre-Budget report shows not only that exports have grown substantially this year, but that they will continue to grow next year at a fast rate, and we are in a position to benefit from the rise in world trade. Regardless of the right hon. Gentleman's speculation about the impact of the dollar, trade from Britain to the rest of the world is rising, exports are rising and they ought to continue to rise. I want Britain to benefit from increased world trade. Again, I would have expected that to be common ground between us.

Oliver Letwin: The Chancellor does not need to worry about speculation. In 1999, foreign direct investment into this country was £54 billion; last year, it was £12 billion, which is about a quarter of the former figure. He surely has to recognise that the depreciation of the dollar or any other external factor is not the main reason for our record trade deficit, or for the fact that foreign direct investment has dropped to a quarter of its earlier level. The main reason is the excessive regulation that he has been imposing and the tax that he has been levying to pay for his wasteful spending.

Gordon Brown: I do not think that the shadow Chancellor lives in the real world. There has been a world downturn, every country in the advanced industrialised world has suffered a loss of foreign direct investment, and the huge pressures of globalisation are hitting every economy as more and more manufacturing work is done in the far east. These are factors common to every industrial economy. The question then is: how well is Britain doing? The answer is that Britain is growing, Britain is creating jobs, Britain has low inflation and Britain has low interest rates. We do not want to go back to the situation described by the shadow deregulation Minister:
	"Fifteen per cent. interest rates, sky-high mortgage arrears, negative equity, bankruptcies, entrepreneurs giving up the ghost on private-run companies . . . I don't think there was a family in the country that didn't experience at least one of those anguishes. A lot of my neighbours lost their houses".
	That was Christmases past under the Conservative Government.

Child Care Costs

Andrew Rosindell: What estimate he has made of the cost of his new proposals for supporting family child care costs.

Paul Boateng: The proposals set out in the pre-Budget report for supporting family child care costs will cost an additional £400 million in 2006–07. The total additional cost from 2007–08 will be £600 million.

Andrew Rosindell: I thank the Minister for his response, but may I move from costs to benefits and ask him what advantage people earning up to £50,000 a year will receive from his new £50 employer voucher? This appears to be a case of one arm of the Treasury not talking to the other. Is it not true that people will lose out on tax credits and receive little or no benefit, or even be worse off?

Paul Boateng: The benefits are real and practical across the income range, not least because of the £125 million transformation fund, which is designed to support capacity in the child care market. On the hon. Gentleman's constituency in particular, under Labour the Clockhouse lane early years centre stands to become a children's centre; under the Tories, were they ever to achieve office, it would be lost. That is the choice—between child care with Labour, or no child care with the Tories.

Peter Pike: Is it not wrong to look at this issue as simply one of cost? As a result of this positive policy, are there not benefits not only to families, but to the nation? Is it not negative to look at this issue in the manner adopted in the question?

Paul Boateng: Having recently visited Burnley, I know that my hon. Friend takes a real interest in this issue, and he is absolutely right. This is not just about benefiting families and enabling them to choose how they balance work-life responsibilities; it is also about a flexible labour market and the benefits to the economy that come when all those who have the potential to contribute to it are involved in it. Child care should support that; under the Tories, it detracted from it.

Julie Kirkbride: What plans does the Minister have to make his Government's child care plans more flexible for working mothers? While many mothers are happy to take their children to school early or leave them there late or with a child minder in another house, many other mothers will, because of their working pattern, want them looked after in their own homes. What is the Minister going to do to make the Government's plans more flexible?

Paul Boateng: The plans are flexible and have been recognised as such by all the charities working in this sector. What has really introduced flexibility to the market—the facts speak for themselves—is that 525,000 child care places have been created as a result of this Government's policy since we came to office. The real flexibility is provided by having a child care policy. The Tories never had one and the result was an inflexible and rigid labour market and a lack of choice for hard-pressed, hard-working parents.

Children's Services

Linda Perham: What assessment he has made of the economic impact of the Government's planned investment in children's services and nursery education.

Gordon Brown: As a result of the pre-Budget report, investment in child care and nursery education, including Sure Start, will rise from £1.2 billion in 1997 to £4.5 billion in 2008, as we invest in the potential of every child to the long-term benefit of the whole economy.

Linda Perham: I thank my right hon. Friend for that answer and I look forward to having a Sure Start scheme in my constituency. I recently attended the launch, under the neighbourhood nursery initiative, of a new learning centre in Hainault in my constituency. Such a provision, which opens between 8 am and 6 pm, is particularly helpful to lone parents. Can the Chancellor explain how the investment that the Government are planning in under-fives services will impact on the participation of lone parents in the labour market and on Government targets for reducing child poverty?

Gordon Brown: The number of lone parents who are employed has risen from 45 to 55 per cent. or so over the last few years. We believe that there is considerable scope for that to continue to rise if adequate child care places as well as training are made available. That is why we made an offer in the pre-Budget report to 250,000 lone parents. If they take up the offer of jobs, they will receive an additional £40 a week allowance for a year—a £2,000 a year bonus for taking on a job.
	The combination of the measures in the pre- Budget report, the additional help on maternity pay, the increased number of hours in nursery education, the growth of children centres—they should average about five per constituency by the time our programme is finished in 2010—as well as the wraparound school care that my hon. Friend talks about, under which schools are open from 8 am to 6 pm, all mean that the choices available to parents are immeasurably enhanced from where they were in 1997. At the same time, our children's benefits are attacking child poverty. I shall give my hon. Friend one more figure. In 1997, the child care tax credit went to 45,000 people; it now goes to almost 300,000. That shows how many more mothers have got more effective choices as a result of our policies.

Vincent Cable: I warmly welcome the increased investments in children's services and nursery education—so much so, that on these Benches we believe that it would be a far better use of taxpayers' money to spend £250 million on early-years provision, rather than on the Government's baby bond to provide cash for 18-year-olds to pay their student tuition fees. After yesterday, does the Chancellor accept that it is not just the Liberal Democrats who have doubts about the child trust fund? The City does, too, as the leading retail provider has now withdrawn all support for the fund. Is it not now inevitable that the Government will have to exercise their expensive default option?

Gordon Brown: It is a very weak-minded Liberal party that is put off the child trust fund just because one of many providers says that it will not be involved. Retail stores, assurance societies, insurance societies and friendly societies are all involved in the child trust fund. I just hope for the sake of children and the future of our country that the Liberal party reconsiders its ridiculous policy. According to the hon. Member for Yeovil (Mr. Laws), who I see in his place next to the Liberal shadow Chancellor,
	"some may be tempted to blow it at 18 on a good holiday or a good party. The Baby Bonds policy should be scrapped".
	This is a measure to encourage savings by all—it gives every child some assets and it ensures that we have a wealth-owning democracy as well as rising incomes for families. I just wish that the Liberal party would, at some point, support a sensible policy. The fact is that, because of the success of our economic policies, we can both expand child care and have a child trust fund, whereas the Opposition would cut public spending by £35 billion.

Angela Eagle: May I congratulate my right hon. Friend on his concentration on child care as a way of providing opportunity for people? I welcome the opening of a Sure Start centre in the Seacombe ward in my constituency, which, even as we speak, is providing extremely effective help to 480 families. I look forward to another pioneering children's centre opening in Leasowe. Those two centres are transforming the lives and opportunities of many of my constituents. I, for one, welcome that.

Gordon Brown: I have visited many of the Sure Start centres around the country. What is really encouraging is not only the benefit provided for children, but the fact that parents who might feel isolated otherwise can meet at these centres. That benefits the children and the whole family life of the community. Increasingly, Sure Start centres are at the heart of every community. If we can have 3,500 of them by 2010—at an average of five per constituency—there will be a very great benefit to family life. However, it would be disastrous if we took the advice of the Liberal party to scrap the child trust fund, or of the Conservative party to scrap the Sure Start children's centres. What future do the Conservatives offer children in this country? None.

Paul Goodman: With reference to what the right hon. Gentleman has just said about children's centres, child care providers have to negotiate their way through 28 separate funding streams and application processes. Will he have a word with the Chancellor of the Duchy of Lancaster, who is responsible for co-ordinating Government policy, to ensure that that complex structure is simplified and that some of the barriers to child care supply can be torn down?

Gordon Brown: This is indeed very interesting—the hon. Gentleman wants Sure Start centres in his constituency. I shall take up his suggestion and make it easier for him to have them, but he had better start talking to the shadow Chancellor, who wants to abolish Sure Start children's centres.

Poor Countries (Debt)

Christine Russell: If he will make a statement on progress towards multilateral debt cancellation for poor countries.

Gordon Brown: Our objective is to match bilateral debt relief by up to 100 per cent., with relief on the debt owed by poor countries to the World Bank and African Development Bank of up to 100 per cent. also to be funded through new commitment from all donors.

Christine Russell: May I thank my right hon. Friend for that encouraging reply? He will be aware that, in common with many other Labour Members, I have hundreds of constituents who communicate with me regularly on matters such as debt relief, and they tell me that they very much welcome and acknowledge the commitment to debt relief that our Government have shown. They have asked me to pass on to my right hon. Friend their earnest wish that Britain, when it assumes the presidency of the G8 and the EU next year, will encourage our colleagues to follow his lead and commit to debt relief.

Gordon Brown: I am grateful to my hon. Friend who, like many hon. Members, is working with the Churches and faith groups to push for debt relief for the poorest countries in the world. In the 1999–2000 period, we persuaded countries to write off 100 per cent. of bilateral debt relief, but we still have to complete the process. That involves writing off the debt owed to the World Bank, the IMF and the African Development Bank. Until now, I had hoped for all-party support in this. Unfortunately, I find that the Conservative party's proposals to cut £35 billion from public expenditure would mean a massive cut in overseas development aid. Again, what sort of Christmas present is that for the third world? The Opposition would cut the Sure Start children's centres, and now we know that they would also cut the overseas development aid.

Tony Baldry: The Chancellor has made it clear that he will pay the UK's share of the remaining concessionary lending debt to the World Bank and the African Development Bank of those countries reaching the heavily indebted poor countries completion point. How much money does he think that that will involve? What indication has he had so far that other donors will be willing to follow the UK's lead? Will this matter be a priority for our G8 presidency?

Gordon Brown: I pay tribute to the hon. Gentleman's work as chairman of the all-party committee. That will be a priority for our presidency. I will talk to the American Administration about it this weekend, and I will meet the IMF and the World Bank to look at practical proposals to allow us to move forward. In the case of debts owed to the IMF, that would be done by use of IMF gold, which would be a bold decision but the right one. I believe that there is increasing support for that from the international community and from the managing director of the IMF. On debts owed to the World Bank, when we tried to act previously we raised a trust fund of something in the order of $3 billion. We have offered to pay off our share—10 per cent.—of the debts owed to the World Bank. I would like other countries to follow. I believe that the different members of the G7 recognise that that has to be done. I am glad that the hon. Gentleman supports our policy, but I ask him please to advise those on the Conservative Front Bench that if they continue to cut overseas development aid in their Budget proposals, they will not be able to finance the debt relief that we are providing. The Conservative party should think again.

Tom Clarke: Does my right hon. Friend agree that the remarkable bilateral and multilateral progress that he has made in respect of debt puts him in a very strong position to encourage developing countries to introduce a strategy where they have mineral resources, such as in the great lakes or even in Angola, so that they can indeed reach the millennium goals and achieve the objectives that he has nobly set?

Gordon Brown: My right hon. Friend has played a prominent part in pushing to ensure that resources are there for the economic development of countries in Africa that have been denied opportunities for too long. That demands a good solution to the trade talks. It also demands that resources be available for education, health and economic development. In the example of Ethiopia, which was the starting country for the Live Aid action 20 years ago, one reason why it has not been able to move forward, and why it has, for example, only 2,000 doctors for 70 million people—a pathetic situation for a country with so many people—is that much of its debt is still owed to the World Bank and the IMF. It is therefore necessary for us to complete the process of debt relief to enable some countries to make the decisions that are right for them. I hope to be able to report progress in the first few months of next year.

Martin Smyth: We welcome what the Chancellor has been saying. He is offering to pay off 10 per cent. Will that be over a period of years, or is it intended to give a lead to others? Can he give any guidance on who might be the loiterers in coming forward?

Gordon Brown: I am grateful to the hon. Gentleman. We are beginning to persuade people, so I do not think naming and shaming is the right way to move forward in the first few months of our presidency. I believe that we can persuade the countries that need to contribute. The hon. Gentleman asked how the debt relief would be paid. Our 10 per cent. contribution is that we will pay all the interest payments due from the poorest countries to the World Bank for as long as they fall due. We are taking on the burden of the debt, and I hope that other countries can follow that course. The money is set against the overseas aid budget, so all parties would have to make a commitment that they would finance that budget to be able to do it.

John MacDougall: I congratulate my right hon. Friend on his contribution to tackling third world debt. Would he care to comment on the work of the Commission for Africa, which faces significant challenges, particularly in terms of the HIV/AIDS epidemic that is sweeping the country and of the number of orphans left in distressful and unfortunate situations? I believe that the commission is doing an excellent job. Would the Chancellor care to comment on its work?

Gordon Brown: My hon. Friend has taken a big interest in these matters, and he is absolutely right to refer to the 11 million children in Africa who are orphans of mothers and fathers who have died from AIDS. That figure will rise dramatically in the next few years unless something is done. In some countries of Africa, a quarter of the adult population suffer from HIV/AIDS. That is why the measures that we are looking at, including giving £500 million a year from the Department for International Development to finance action on AIDS, are desperately necessary.
	We have a meeting in Johannesburg at the beginning of January with the Commission for Africa and we will try to get agreement on a package of measures that could finance action on HIV/AIDS, malaria, tuberculosis and all the killer diseases in Africa. I hope that when we publish the Commission for Africa report we will have all-party agreement that we need to spend the money necessary so that illiteracy can be tackled—110 million children are not going to school today—and so that the 6 million avoidable deaths from killer diseases can be dealt with through prevention and cure.

Growth and Stability Pact

James Plaskitt: What objectives he intends to pursue during the UK's EU presidency in respect of the growth and stability pact.

Gordon Brown: The Government will continue to pursue our objective of a stability and growth pact that takes into account the economic cycle, debt sustainability and the role of public investment. I intend to publish later today the UK's 2004 convergence programme. The Government are also publishing today their autumn report on euro preparations.

James Plaskitt: Continental Europe seems to be stuck with rates of unemployment far higher than ours. Is it possible to argue that the growth and stability pact has delivered stability, but of the sort one tends to notice in a corpse? Under my right hon. Friend's stewardship, by contrast, the United Kingdom has announced outstanding records on both growth and job creation. What advice on the future of the pact will he give his European colleagues over the next few months?

Gordon Brown: It is true that the euro area has higher inflation and higher unemployment with lower growth than we do. The issue arising is whether the stability and growth pact gives a degree of co-ordination that is necessary with the monetary authority of the European Central Bank to enable Europe to continue to grow at a rate that would bring down unemployment. We have three specific proposals. First, just like our fiscal rules, Europe should take into account the economic cycle. Secondly, those countries with low levels of debt should be allowed to borrow. That would be positive for growth. Thirdly, they should recognise the important role of public investment, as we do in setting our fiscal rules, to enable countries with low debt to be able to borrow to make the necessary public investment to build up their infrastructure and to secure economic growth for the future. I believe that the main economies of Europe are moving towards the views that we have expressed for seven years on the stability and growth pact. I hope that during the Luxemburg presidency many of the rules that underlie the implementation of the stability and growth pact will be rewritten.

Richard Spring: Given that UK net borrowing has breached the 3 per cent. level, does the Chancellor agree that a key objective of the UK presidency would be to avoid the excessive gloating, tellingly referred to by the Chancellor's comrade-in-arms Lord—oh, I am sorry—Mr. Peter Mandelson?

Gordon Brown: It is not usual to refer to Members in another place. I must correct the hon. Gentleman—the deficit this year is 2.9 per cent., not 3 per cent. That compares with other countries, including America and Japan, where the deficit is over 4 per cent., in both cases around 5 per cent. In Japan's case it is nearer 6 per cent. now. So our record is a good one and he should congratulate us on our management of public finances. Unfortunately, the only contribution that the Conservatives could make to public finances would be to cut £35 billion of public spending. Even if they sacked every civil servant in the country, they could raise only £15 billion, so they would have to find a further £20 billion from massive cuts in our public services. It is about time that they explained how many nurses, teachers and carers would lose their jobs.

Nigel Beard: What are the likely consequences of the European Union continuing effectively without any fiscal rules if the stability and growth pact is not reformed?

Gordon Brown: It is clear that the pact will be reformed and that all countries now recognise that the existing implementation rules cannot be sustained. Because France and Germany are not going to be disciplined as a result of the breach of the rules, it is clear that the rules will have to be changed; otherwise, the pact cannot survive. I believe that in the next few months we shall see proposals that will make the pact more understanding of the needs of the economic cycle and of public investment and more sympathetic to countries with low debt.

National Insurance

Michael Fallon: How much is expected to be paid in national insurance contributions in 2004–05; and how much was paid in 1996–97.

Dawn Primarolo: Since 1997, average earnings have grown by over 25 per cent. and there are now an extra 1.8 million people in work. Receipts of national insurance contributions reflect this economic success and increased national prosperity. The Government Actuary estimates that in 2004–05, £80,962 million will be paid in national insurance contributions. The amount paid in 1996–97 was £47,627 million.

Michael Fallon: Is not the reason why Ministers refuse to rule out an increase in national insurance contributions, as they have ruled out increases in VAT on food and children's clothing, that if one votes Labour at the next election, national insurance is the tax most likely to be increased in the next Parliament, just as the Government increased it in this Parliament?

Dawn Primarolo: No. As the hon. Gentleman knows, all the Government's spending plans are affordable. The party that makes promises before an election and breaks them directly afterwards is the Conservative party, as it did in 1992, when it promised not to raise VAT and then did.

Kevin Brennan: Is it not the case that the discretionary part of the increase in national insurance of 1 per cent. was supported strongly by the British people as necessary in order to put right the mess that had been made in the NHS over many years by the Conservatives, and that the automatic increase is a result of the success of the Government's management of the economy? Rather than the boom and bust approach of the Conservatives, we now have sustained investment and growth.

Dawn Primarolo: My hon. Friend is correct. Some £7.8 billion was raised to pay directly to the NHS—to fund the investment necessary after it was starved of resources for a sustained period by the Conservatives—and that was widely supported by all our communities. The question is whether the Opposition would remove that investment and cancel the 1 per cent. increase.

George Osborne: Does the Paymaster General remember that before the last election the Prime Minister said that people "shouldn't suppose" that national insurance would go up if Labour were elected. Of course, it went up in the next Budget. Given her refusal to rule out increases in national insurances in response to my hon. Friend the Member for Sevenoaks (Mr. Fallon), should not people suppose that after the election national insurance will go up if Labour wins?

Dawn Primarolo: What we need to know from the hon. Gentleman, given that he is so obsessed with the 1 per cent. national insurance increase—[Hon. Members: "Answer the question."] I have made the Government's position absolutely clear on the commitment to the 1 per cent. increase, which was supported by our communities to pay for investment in the NHS. Would the Conservatives remove it or are they committed to it?

Hugo Swire: rose—

Mr. Speaker: Order. That is all that the Paymaster General has to say.

Gold Sales

Teddy Taylor: If he will make a statement on the implications of his instruction to the Bank of England to sell gold.

Gordon Brown: The aim was successfully to achieve a reduction of risk in the net reserves portfolio. The reduction achieved, as measured by value of risk, was 30 per cent.

Teddy Taylor: Would not it help the Government's credibility if they would accept it when mistakes are made? Does the Chancellor accept that the 395 tonnes of gold that he instructed the Bank to sell secured $3,496 million, but the current value of that gold is $4,961 million, which means a loss of $1,465 million or £800 million, which is equivalent to more than £15 for every person in Britain? Does not he accept that it was also an error to instruct the Bank to put 40 per cent. of the proceeds into the dollar just before it had an appalling fall? Does he accept that a mistake was made? While we accept that many things have gone right, would not it be helpful if the Government would accept it when something has gone wrong?

Gordon Brown: Almost all the major economies, including France and Switzerland, which are gold holders, have been selling gold recently, with the exception of the US and Germany. The mistake that we made as a country was not rebalancing our reserves earlier, in the 1980s and 1990s. When we came to power, we made a decision to do what it had been advised we should do for a long time. We made the right decision to have the right balance of reserves, including holding dollars, euros and yen. The hon. Gentleman will not like it, but the value of our euro holdings has gone up, as a result of the euro going up by 14 per cent.

Owen Paterson: That argument is absolutely ridiculous. This is the most arrogant, blundering and incompetent Chancellor. He has thrown away nearly £1.5 billion of taxpayers' money, or £58 per household. As a little present to this country, would he just once like to apologise?

Gordon Brown: There is not much Christmas spirit around, is there? As we are talking about apologies in the running of the economy, could we have an apology for the 15 per cent. interest rates, the 10 per cent. inflation, the 3 million unemployed and the massive cuts in public spending?

International Cricket Council (Tax)

Hugh Robertson: What representations he has received on the future tax treatment of the International Cricket Council headquarters.

Dawn Primarolo: The Government received a representation from the hon. Gentleman dated 13 December 2004. A representation from the UK Sport council on taxation issues relating to international sports federations has also been received, and we shall consider representations on relevant tax issues as part of the Budget process.

Hugh Robertson: I thank the Minister for that answer. She will be aware that the UK has lost a number of international sports headquarters recently—rugby, athletics, table tennis and badminton have all gone abroad—because of the UK tax regime. That has clearly resulted in revenue loss to the Exchequer, jobs lost to the UK economy and damage to the UK's international sporting standard, which is not good news in front of the London 2012 bid. Can the right hon. Lady tell the House today exactly what action she is planning to take as a result of the submission from UK Sport to guarantee the future location of the International Cricket Council in London?

Dawn Primarolo: It would clearly be inappropriate for me to comment on an individual taxpayer, due to taxpayer confidentiality—[Laughter.] It is a simple fact: I am unable to do that. The sports council raised three issues on taxation, one of which was about corporation tax. The fact of the matter is that most international sports federations pay little or no corporation tax—an absolutely negligible amount. They are based here for a wide range of other reasons. An exemption from corporation tax would allow those federations to develop a wide range of commercial activities, free of tax considerations, and that would run counter to the policy not only of this Government but also of the previous Government, which strictly observes that commercial activities should maintain a level playing field to avoid potential unfair tax competition and state-aid issues. The other issues raised by the sports council were on VAT and the national insurance contributions of their employees and it has received a response from the Government on both.

Andy Reed: I understand the complexities of the situation, which also pertain to a large number of other national governing bodies, especially with regard to corporation tax. I hear what my right hon. Friend says, but is she aware, for example, that rugby football union paid £3 million in corporation tax last year on a loss? Will she look again at the VAT question right across the board, so that we can have a whole-sport approach? A number of governing bodies, including athletics, say that some of the impacts have complications regionally. Could we have a national approach to work with sport, to build on the fantastic success of community and amateur sports clubs and the rate relief that we have given to sports clubs up and down the country? There is some concern at national governing level, and we need to work together to create—I am afraid to use this phrase—a level playing field.

Dawn Primarolo: Because of my hon. Friend's involvement in the subject, I know that he is very aware that the Government have been committed to improving sport right across the country, including investing in schools, communities and elite sports in a way that has never been done before. He will recall that the 2004 spending review announced that the Government would pledge another £431 million for sport in the period 2005–08, which represents a rise of 31 per cent. in the amount that we are investing. It is simply not possible to bend tax rules for some. It is quite straightforward: corporation tax is levied except in circumstances where there is an exemption—for instance, a charity—and all the sports councils pay barely any corporation tax. The amount is negligible, so there cannot be the massive effect that is being claimed with regard to their future locations.

Education

John Battle: What representations he has received on his spending plans for education.

Paul Boateng: The Government regularly receive representations on spending plans for education. We are taking forward a programme of high investment in education and skills. From £36 billion in 1996–97, the education and skills budget for the UK stands at £63 billion in 2004–05, and is set to rise to £76 billion by 2007–08.

John Battle: My right hon. Friend will recall that some of us spent some 10 years on the Opposition Benches resisting real cuts in education budgets every year under the Conservative Government, so I welcome the real, increased investment particularly in primary schools in Armley, Bramley, Kirkston and Wortley in my neighbourhood. I am thinking of the brand new Five Lane Ends school, and I am looking forward to the Holly Bush school opening next year. I also thank him for the innovative Sure Start funding projects in Bramley and Burley, but will he build on that start and assure me that future education spending plans will include increasing investment in secondary education to secure the future well-being of our communities in west Leeds?

Paul Boateng: I recall those days only too well, having shared an office with my right hon. Friend for most of them—and they were bad days. [Laughter.] They were bad days for education, and the reality is shown by the results of the programmes that the Government have instituted, not least in Leeds, where the excellence in cities initiative has provided intensive support for schools that face particular difficulties. The city academy programme, to which he has referred, and the building schools for the future programme have also been introduced. All those programmes have benefited Leeds and led to improved results in secondary education in Leeds. The commitment is to continue to fund those programmes, and the choice at the next general election will be very clear: to return to those bad old days of falling standards, or to maintain progress under Labour—rising standards and increased investment in schools.

David Laws: On the day of the pre-Budget report this year, the Chancellor announced that he was raiding departmental budgets to find money to keep down council tax rises next year. The Government have yet to tell us which departmental budgets have been raided. Will the Chief Secretary take this opportunity to clarify that and to tell us whether the Department for Education and Skills and the Department of Health lost money?

Paul Boateng: Every Department has benefited from increased spending, and what the hon. Gentleman, who speaks for the Liberal Democrats on public spending matters, has to answer is how he could afford continuing programmes to improve standards in education and continuing provision for child care because the reality is that, on every front, the Liberals promise one thing in the House and deliver something quite different when they have control of councils in the country.

Barry Sheerman: Does my right hon. Friend agree that millions of families in this country would not agree that the investment in education over the past eight years has been a waste of public expenditure—especially those who have benefited from free nursery school education, which, as all the research shows, represents very good investment? Much of the investment has been well received and useful, but there is not necessarily a relationship between more money and better results, with one exception: higher education. Our expenditure on higher education has been less generous than in other areas. Is my right hon. Friend aware that, if we are to have an internationally competitive economy, we must invest more in higher education, and soon?

Paul Boateng: I pay tribute to the role that my hon. Friend has played, as the Chairman of the Select Committee on Education and Skills, in ensuring an increase in investment in every area of education. He will recognise the importance of investment in further education, which has gone up under this Government, and the importance, too, of higher education, which he has emphasised. He will recognise, I am sure, that my right hon. Friend the Chancellor, in his 10-year science and innovation strategy, paved the way to a bright future for our universities, with a 6 per cent. increase in funding. That is what makes our economy strong and productive, and it will ensure the continuation of the growth that is unparalleled in the G7 at this time.

Olympic Bid (2012)

Laura Moffatt: What assessment he has made of the likely impact on the south-east economy should the 2012 London Olympic bid be successful.

Stephen Timms: Winning the 2012 Olympics would bring significant benefits to the UK as a whole, providing new opportunities for businesses, attracting significant inward investment and significantly boosting tourism. The Department for Culture, Media and Sport is convening a conference next month to look at the economic opportunities for the country as a whole, and we are keen to maximise the potential benefits.

Laura Moffatt: May I say that I am grateful for my hon. Friend's response because in towns such as Crawley, we firmly believe that a successful bid will be of huge benefit to not only London, but the whole of the south-east? We would have new Olympic-standard facilities, and spreading the fantastic wealth that could flow from the Olympic bid would make an enormous contribution to my town.

Stephen Timms: I agree with my hon. Friend about the opportunities for Crawley, the whole region and the country as a whole. The Olympics and Paralympics will inspire people of all ages and abilities to participate in sport and give us the chance to renew our sporting infrastructure. There is especially strong enthusiasm in east London and the borough of Newham, which I represent, because many of the facilities for the games will be located there. However, it is important to draw attention to wider opportunities, such as those that will arise from national Olympic committees outside the UK wanting to set up training facilities around the area in the two years before the games. There are great opportunities that we want to realise.

Child Care (London)

Karen Buck: What recent assessment he has made of the child care needs of families in London.

Stephen Timms: We published a 10-year strategy on child care alongside this year's pre-Budget report, as my right hon. Friend the Chancellor has said, and it recognised variations in child care needs and provision, including those in London. We announced changes to the child care element of working tax credit, which will benefit London families with high child care costs, and a pilot with the Greater London Authority to examine improving the affordability of child care in London.

Karen Buck: My hon. Friend is absolutely right to say that access to, and the affordability of, child care in London is a specific problem that has been a barrier to parents who seek to go to work. I warmly welcome not only the investment in Sure Start, children's centres and the neighbourhood nurseries initiative, but the increased generosity of the tax credits for child care announced by my right hon. Friend the Chancellor in the pre-Budget report, which will disproportionately benefit London families. However, will my hon. Friend investigate the behaviour of London local authorities, such as the Royal Borough of Kensington and Chelsea and Liberal boroughs such as Southwark and Islington, which take Government money for investment in child care, yet cut their own contributions for child care, which Kensington and Chelsea did when it removed £350,000 from its child care contribution? Will he ensure that local authorities work in partnership—

Mr. Speaker: Order.

Stephen Timms: I pay tribute to my hon. Friend's work as a consistent champion of improving child care in London. I am grateful for her recognition of the progress that we made in the pre-Budget report towards the aim that every child should have the best start and that parents should have more choice when balancing work and family life. She is right about the increase in the cost limit from £200 to £300 a week for two or more children. I also agree that it is essential for all those involved to play their part in bringing about the improvements that we need in London and elsewhere, so Conservative and Liberal Democrat London councils have a lot to answer for. She is right that we need to examine what is happening.

Mark Field: I welcome several of the Minister's initiatives, and I shall put to one side the party political banter that has gone on with my next door neighbour, the hon. Member for Regent's Park and Kensington, North (Ms Buck). However, as a London Member, the Minister will be fully aware that the cost of living in London is fast rising, as was reported only yesterday in the Evening Standard. The effective rate of inflation in London is some 7 per cent. Does he appreciate that there is a need for tax breaks and imaginative tax treatment for child care for parents in London, because the earnings of many of them may be considerably higher than average, yet they none the less find themselves in grave difficulty meeting those child care costs? I will be interested to hear what the Minister says about ensuring that child care benefits go beyond only the poorest and most vulnerable in our society.

Stephen Timms: I think that the hon. Gentleman will particularly welcome the announcements in the report published at the time of the PBR. I have mentioned the increase in the limits for help with child care costs in the child care element of tax credit from £200 to £300 a week, which is particularly beneficial in London, where costs are indeed higher. The hon. Gentleman will also welcome the increase in the proportion of costs for which a claim can be made from 70 per cent. to 80 per cent. The document includes the example of a family household earning £34,000 a year, who will enjoy a benefit of £700 a year. All those benefits will be particularly helpful in London because, as he rightly said, costs there are higher, and that is reflected in our proposals.

Personal Saving

Geoffrey Clifton-Brown: If he will make a statement on the contribution of personal saving to the economy.

John Healey: Saving is important to provide people with opportunity and independence throughout their life, the flexibility to deal with unforeseen circumstances and, of course, financial security in retirement. The Government therefore back a wide range of tax-favoured savings and investment, including the individual savings account and other forms of personal saving, amounting to about £2 billion a year of tax support. We also provide tax relief for pension saving worth more than £11 billion a year.

Geoffrey Clifton-Brown: I thank the Minister for his reply, but one of the Government's biggest economic failures is the reduction of the savings ratio by more than a third. It is hardly surprising that we now have the highest rate of tax for 26 years. For example, £27 billion has been taken out of pensions, and one of the Government's worst tax failures has been to ruin personal equity plans and tax-exempt special savings accounts. Their replacement, individual savings accounts, are now being cut as well. That is a mean measure for small savers, so what will the Government do to restore the savings ratio?

John Healey: More people who are saving through ISAs than did so through PEPs and TESSAs. When the economy is stable, people tend to feel more confident and are less inclined to need the cushion of savings. The hon. Gentleman invited me to make comparisons with the previous Government, but it is not an achievement to scare people into saving, as they did. People were worried by the stop-go economy. They were scared of losing their job, as 3 million people were unemployed, and they struggled to cope with inflation at 10 per cent.

Lawrie Quinn: I welcome my hon. Friend's answer, but can he tell the House what the Treasury is doing to make sure that the most disadvantaged communities receive support from the British banking industry? How is it encouraging the establishment of credit unions and savings clubs to allow those communities to take appropriate measures for saving for the future?

John Healey: My hon. Friend takes a close interest in this in his constituency, and he is quite right about the importance of such savings arrangements. While we need and want to encourage a stronger savings culture across the country, we have a particular concern for the poorest communities and families. He will be aware of our savings gateway pilot, in which the Government match the savings that the poorest are prepared to put aside. My right hon. Friend the Chancellor announced in the pre-Budget report that we would back that scheme with another £15 million, and roll it out further to test its impact.

European Regional Aid

Andrew George: What discussions he has had with his counterparts in other EU member states in respect of the future of European regional aid.

John Healey: The Chancellor discussed the future of structural and cohesion funds with his counterparts in other European Union member states at both ECOFIN and bilateral meetings.

Andrew George: The Minister will be aware that the most significant strength of EU regional aid is that it gives clear geographical focus to distinct economic regions such as Cornwall and Scilly, which have an average gross domestic product lower than many regions in EU accession states. It also provides guaranteed funding for a decent seven-year package. What reassurance can he give me that in the future round, beyond 2007, the Government will ensure that places such as Cornwall maintain that geographical focus and have a guaranteed seven-year package of funding?

John Healey: Like the hon. Gentleman, I represent a constituency in an objective 1 area, so I recognise the role that that form of funding, alongside massively increased investment from the Government, plays in the economic regeneration of such regions. As part of our plans and negotiations on the reform of structural funds, the UK Government have made a unique commitment that we will increase domestic spending so that the UK nations and regions do not lose out as a result of those reforms in Europe.

Paul Farrelly: Does my hon. Friend agree that European regional aid has been an important source of regeneration funding in the UK? In my constituency, it has recently helped to build two new enterprise centres at Silverdale colliery. People who simply rant against the EU are wilfully blind to the benefits that it can bring to traditional areas such as north Staffordshire.

John Healey: My hon. Friend is right that such spending has a role and that Europe should contribute. We consider that reforms should be put in place from 2007 onwards. EU spending should be focused where it is needed most in poorer member states, which have a weaker financial and institutional capacity to deliver regional policy. He is right about the important role of regional funding, and his constituents will be alarmed by the £35 billion cuts planned by the Conservative party. The shadow deregulation Minister, the right hon. Member for Wokingham (Mr. Redwood), has said that we should discontinue regional and other industrial support, which runs at £1.9 billion.

Future Infantry Structure

Geoff Hoon: With permission, Mr. Speaker, I would like to make a statement about the future structure of the Army.
	In July, I announced a re-balancing of the Army designed to make it better able to meet the challenges and threats of the 21st century. The changes that I announced then reflect the need both to complement our existing heavy and light-weight capabilities with new medium-weight forces, and to ensure that the Army is equipped, trained and organised to meet the demands of multiple, concurrent and above all expeditionary operations across the full spectrum of military tasks. Reductions in heavy armour, heavy artillery and the infantry will be accompanied by an increase in the number of key specialists, without whom the Army cannot deploy on operations. Our objective is therefore to develop a more deployable, agile and flexible force.
	Since July, the Army has been engaged, under the leadership of the Chief of the General Staff, General Sir Mike Jackson, in detailed work on how the changes should be implemented. I will now set out to the House the results of the Army's deliberations. The future Army structure is underpinned by two complementary changes. First, a move towards a more balanced force organised around two armoured brigades, three mechanised brigades, a light and an air assault brigade, in addition, of course, to the Royal Marines Commando Brigade.
	We are moving ahead quickly with the changes required to put that in place, and 19 Mechanised Brigade, based in Catterick, will start its conversion to a light brigade in January. The brigade will be ready for deployment on operations if required in the first half of 2006, when it will serve as the contingent NATO response force. Based in Germany, 4th Armoured Brigade will convert to a mechanised brigade in 2006, and the other brigades will adopt their new structures in a similar time frame. The key foundations on which the future Army structure is to be built will be in place by 2008.
	However, it is important to emphasise that we cannot use front-line soldiers if they cannot be deployed and sustained on operations because we lack sufficient supporting forces. In parallel, therefore, we are moving ahead with the second element of the re-organisation—making the Army more robust and resilient and able to sustain the enduring expeditionary operations that have become commonplace in recent years. The overriding requirement is to make significant enhancements to the key specialist capabilities—communications, engineers, logisticians, intelligence experts and other key capabilities. At the same time, we want to make fighting units, including the infantry, more robust by ensuring they have adequate numbers.
	This is an ambitious programme of change that will take several years to complete. It is more far reaching in its impact on the Army than "Options for Change" in 1991. Virtually every Army unit establishment has been examined, and 10,000 posts will be redistributed. We still have further work to do in establishing all the new arrangements. However, enhancements that we have already decided on include the creation of a new commando engineer regiment, a new port and maritime unit, an additional strategic communications unit and a new logistics support regiment for each deployable brigade. We are also creating a number of new sub-units for surveillance and target acquisition, bomb disposal and vehicle maintenance capabilities.
	Those are new capabilities; they are not cuts. They are being backed up by an impressive re-equipment programme, introducing new communications equipment such as Bowman and Falcon, enhanced intelligence collection assets such as the Watchkeeper unmanned aerial vehicle and Soothsayer electronic warfare capability, modern vehicles such as the Panther armoured reconnaissance vehicle, and looking further ahead, the ambitious FRES armoured fighting vehicle programme, which will modernise the armoured vehicle fleet and form the basis of the medium-weight capability.
	These enhancements will directly improve the ability of the Army to deploy, support and sustain itself on the range of operations that we envisage. That can only be achieved as the result of the planned reduction by four in the number of infantry battalions, which will release around 2,400 posts for redeployment across the force structure.
	I now turn to the changes to the infantry. I know that this is an emotive subject. I entirely understand its importance to morale, esprit de corps and operational effectiveness of regimental traditions. However, we need to consider these changes to the infantry in the wider context of rebalancing the Army and the opportunity that affords to re-allocate manpower to those areas that current and future operations require us to develop. Very few of our regiments and corps exist today in the same form in which they existed in the past. There has been a recurrent process of change and regeneration over the past 150 years. In the last decade, for example, under the previous Government, "Options for Change" represented the first attempt to reshape our armed forces to reflect the post-cold war era. Each change, designed to make the Army more relevant to the prevailing strategic context, was passionately opposed at the time, but on each occasion new organisations were created, fostering military renown while developing their own traditions and reputations to engender loyalty and camaraderie. That remains our guiding principle.
	We are able to reduce the size of the infantry because of the reduction in the requirement for permanently committed forces to support the Police Service of Northern Ireland that flows from the encouraging progress towards a lasting settlement in the Province; and the decision by the Army Board that the infantry arms plot—the mechanism by which units routinely move location and change role every few years—no longer represents the best way to deliver operational capability. In future, battalions will be fixed by role and largely by location. That requires that we find a new means of providing variety of experience and posting for individuals to sustain the operational flexibility for which our infantry units are rightly famed. In future, this will be provided through individual posting. The only means of doing that within the framework of the regimental structure is by having regiments of more than one battalion.
	Let me emphasise that this is not a revolutionary concept. The Army Board took a decision as long ago as 1962 to establish large regiments. Nearly half the infantry is already organised in this way and operates extremely effectively. Multi-battalion regiments will allow individuals to move between battalions while at the same time maintaining the sense of regimental identity that is so critical to the Army's ethos and fighting effectiveness.
	Those who argue against ending the arms plot need to explain why. Ending it will ensure that we get far more military capability out of the resources that we have. Of the 40 battalions in the current order of battle, as many as 11 are likely during any 12-month period to move location or to re-role. At any one time, as many as seven may be unavailable for operations. That is simply not efficient. The logic is undeniable: at the end of this process, many more, if not all, of the future 36 infantry battalions will actually be available for operations.
	Phasing out the arms plot will mean that the infantry is able to offer much greater stability for soldiers and their families. It will allow career development for soldiers and officers to be much more carefully planned, while keeping the variety, opportunity and challenge of new roles and locations open to all soldiers within large regiments; and it will give greater brigade cohesion by maintaining units within formations.
	There has been a wide-ranging and detailed consultation exercise, with the infantry being invited to express their views on how the restructuring should be implemented. I am also grateful to the many hon. Members who have played their part in representing the interests of their local regiments.
	The Army has concluded that the only prudent basis on which to make decisions is one that has regard to the long-term sustainability and effectiveness of the battalions concerned, based on an analysis of historic manning statistics, regional demographics and future manning predictions. But it has, rightly, tempered that with a recognition of the need to take account of regional and geographic representation. That is why, for example, we are looking to Scotland for only one reduction, and why the Royal Irish Regiment has been exempted from consideration.
	The Army also considered the Gurkha battalions but concluded that, given the requirement to sustain the Brunei garrison and their excellent manning record, they should not face any reduction. It also took account of the ceremonial duties required of the five battalions of the Foot Guards, and concluded that those justified the status quo in relation to both the number and organisation of these battalions. In considering the Foot Guards, the Army took the view that any change to titles or structure would ultimately affect their ability to sustain the ceremonial roles that are so important to the fabric of our national life. Their existing structure already provides the geographical stability that we are looking to achieve elsewhere.
	Against that background, I have decided, as recommended by the Army, that the first three battalions should be reduced by taking one battalion from the Scottish Division. The Royal Scots and the King's Own Scottish Borderers will merge. That and the other four battalions—including the Black Watch—will become part of a new large regiment, to be called the Royal Regiment of Scotland. The identities of the antecedent regiments will be preserved in a variety of ways, not least by including them prominently in the battalion titles of the new regiment. So, for example, 1st Battalion the Royal Highland Fusiliers will become the Royal Highland Fusiliers (2nd Battalion the Royal Regiment of Scotland).
	One battalion will be taken from the area west of the Pennines. The King's Own Royal Border Regiment, the King's Regiment and the Queen's Lancashire Regiment will amalgamate to form two new battalions within the new King's, Lancashire and Border Regiment.
	One battalion will be taken from the Prince of Wales's Division, in the south of England. That will be achieved by merging the antecedent components of the Royal Gloucester, Berkshire and Wiltshire Regiment with, in the case of the Glosters, the Devonshire and Dorsetshire Regiment, which will then merge with the Light Infantry, and, in the case of the Duke of Edinburgh's Royal Regiment, with the Princess of Wales's Royal Regiment.
	In considering how the fourth reduction should be made, I have taken into account the need for additional specialist enabling support, which will underpin our future expeditionary capability.
	Our special forces are critical to our prosecution of the war against terror. We were able to announce some improvements to our special forces in July. We are also considering the broader arrangements whereby the armed forces provide support to special forces operations. One option that has emerged in that continuing work is the creation of a tri-service "ranger" unit, which would be dedicated to special forces support. I have decided that it would be appropriate to develop such a unit over the next few years, and it would take its place alongside the other enhancements to specialist support elements of the Army. The fourth infantry battalion reduction will therefore be found by removing the 1st Battalion the Parachute Regiment from the infantry structure and using its highly trained manpower as the core of a new, tri-service ranger unit.
	The changes that I have announced today mean that the infantry will now, with the exception—for the reasons that I have outlined—of the Foot Guards and the Royal Irish Regiment, be organised into large regiments. The seven existing multi-battalion regiments will continue.
	In addition to the changes that I have already announced, the Royal Welch Fusiliers and the Royal Regiment of Wales will combine as the Royal Welsh. They will be known respectively as 1st Battalion the Royal Welsh (the Royal Welch Fusiliers) and 2nd Battalion the Royal Welsh (the Royal Regiment of Wales).
	The Staffordshire Regiment, the Cheshire Regiment and the Worcester and Sherwood Foresters will combine as the Mercian Regiment and be known as 1st Battalion the Mercian Regiment (Cheshires), 2nd Battalion the Mercian Regiment (Worcesters and Foresters) and 3rd Battalion the Mercian Regiment (Staffords).
	The Duke of Wellington's Regiment, the Prince of Wales's Own Regiment and the Green Howards will come together to form the Yorkshire Regiment and be known as 1st battalion the Yorkshire Regiment (Prince of Wales's Own), 2nd Battalion the Yorkshire Regiment (Green Howards) and 3rd Battalion the Yorkshire Regiment (Duke of Wellington's).
	The move to larger, multi-battalion regiments is the only sustainable way in which to structure the infantry for the long term. In implementing the new system, the Army will ensure that the regimental traditions, heritage, cultures and local connections will live on in the new arrangements. Golden threads of identity will be preserved in any new uniform, for example, by the retention of accoutrements—[Interruption.] There are hon. Members who would like to hear this. Those accoutrements include the Black Watch hackle.The new battalions will continue to recruit in the areas of their original constituent elements. Regional recruiting will remain the bedrock of the British infantry.
	There will be no diminution in the role of the Territorial Army and the reserves. The TA will, in future, be more closely integrated with the regular Army for both training and operations. Each of the 14 TA infantry battalions will be part of a regular parent regiment, one per regular regiment with the exception of the Royal Regiment of Scotland, which will have two, and the Guards Division, which will have one affiliated TA battalion.
	The TA is also to be rebalanced to support large-scale operations and home defence, as well as remaining capable of reinforcing regular units deploying on enduring operations. It will remain broadly the same size as today but with a structure that is more capable and relevant to future operations. Complementing the changes to the regulars, those changes will provide more TA manpower for specialist areas including intelligence, engineers, Military Provost Service and attack helicopter support teams. TA establishments will be organised to accommodate personnel who may not be able to deploy in support of large-scale operations. They will also be sufficiently robust to take account of personnel undergoing individual training. The final arrangements will be the subject of further announcements in due course.
	As part of our work on the future Army structure we have also examined the requirement for Army musicians. On the basis of recommendations made by the Army, it has been decided that there should be a reduction from two to one in the number of bands per division of line infantry, and the number of Royal Armoured Corps bands should be reduced from four to two. We will also reduce the band of the Light Division by 14 posts, to bring it into line with the rest of the line infantry.
	We will try to ensure that individuals affected by these changes are provided with the chance to retrain and re-role to take on new tasks. But the changes in the infantry and bandsmen that have been announced today will require a limited redundancy programme. The scheme will be carefully targeted on the small number of infantry personnel and Army musicians who, for whatever reason, are unsuited to be retrained and employed elsewhere in the Army. It will be designed to ensure that we maintain a balanced rank and age structure, and are able to continue recruiting. Not to do so could impact on military effectiveness by creating promotion blockages. We anticipate that about 400 personnel will be affected. Details of terms and conditions will be set out in the new year.
	However—let me be clear about this—a redundancy programme does not mean that career opportunities in the Army will be reduced. The Army will continue at around its current size. At around 102,000 strong, it will continue to require more than 11,000 new recruits every year, and offer a wide range of high-quality employment and training opportunities.
	I have never failed to be impressed by the Army's professionalism, courage, and determination to succeed. It is a body of men and women of whom the nation is justifiably very proud, and I know that the whole House will want to join me in paying tribute to them. I am convinced—and so is the Army—that the transformation that we have set in hand is the right course for the future. The new structure will deliver an Army fit for the challenge of the 21st century. It will preserve the vital traditions and ethos, and it will improve the lives of soldiers and their families. I commend it to the House.

Michael Ancram: The shadow Secretary of State, my hon. Friend the Member for Mid-Sussex (Mr. Soames), very much regrets being unable to respond to the statement today, but he is recovering from an operation.
	I thank the Secretary of State formally for giving me advance sight of that dismal statement. This is a dark day for our armed forces. It is an even darker day for the proud regiments that the Government seek to scrap. They have given outstanding service to our country, and we owe them much. In tribute to them, I am making a list of their names and achievements available in the Library.
	This is also a day of shame for this discredited and ineffective Defence Secretary—discredited, because he seeks to hide his direct responsibility for today's decisions behind the coat tails of the generals; and ineffective, because he has abdicated his historic ability to defend our armed forces against the ravages of the Treasury.
	Behind the spin, the reality is stark: 19 great regiments gone, infantry battalions cut from 40 to 36, the Army trained establishment cut from its current target of 108,500 to a target of 102,000 by 2008. Today's announcements are dangerous for our country. In the words of the former Chief of the Defence Staff, Lord Guthrie, in The Sunday Telegraph last Sunday, the Army
	"has become dangerously small for what it is being asked to do".
	Today's statement will make it even smaller.
	The Secretary of State says that this is all about reorganisation. None of us is against necessary reorganisation, but this statement was driven not by a need to reorganise but by the Chancellor's demand for financial cuts. I welcome the decision to create a new tri-service ranger unit dedicated to special forces support, but can the Secretary of State confirm that as a result of the changes that he has announced to the Parachute Regiment's structure, there will not now need to be a reduction of a fourth battalion from the infantry of the line?
	The Opposition agree that there is a need for our armed forces to be more usable. We accept that the arms plot is disruptive to families and to the operational needs of the Army. What we do not accept is the Secretary of State's attempt to use that to justify cuts in infantry manpower, or his attempt to paint those cuts as Army driven when, as we know, they are politically driven, and designed to help fill the Chancellor's gaping black hole.
	Today, we face considerable threats from terrorism at home and abroad. We have a grossly overstretched Army undertaking major military deployments over- seas. Since the strategic defence review, our armed forces have effectively been conducting continual, concurrent operations, deploying further afield to more places, more frequently, and with a greater variety of missions than was ever assumed. We still have our obligations in Northern Ireland, the Balkans and Cyprus, and the Government's White Paper anticipates that, around the world, those obligations will increase.
	Even as we speak, our soldiers are fighting in Iraq, where we expect to remain until 2008 at least. I am sure that the whole House welcomes the Black Watch back with pride. We are under pressure to increase our commitment to Afghanistan. To meet some of these burdens, since 1999, approximately 30 per cent. of the Territorial Army has been mobilised to support the regular Army operations overseas.
	Today's decision therefore flies in the face of reality. There is a serious military case for more infantry, not less. As Chief of the General Staff General Sir Mike Jackson told The Sun on 16 November:
	"I would much prefer increasing the size of the Army but that's simply not on offer. I can either accept what's on offer—a reduced size of the Army—or go."
	We would not have made these cuts—and, after the election, we will not carry them through. We would not see these regiments go or these battalions reduced. We believe profoundly that these reductions are wrong.
	Let me make our position clear: we will increase front-line spending by £2.7 billion, because that is what our national security requires.
	Therefore, let me ask the Secretary of State some questions. What has happened since 1998 to convince him not only to reverse the SDR plans but to introduce further cuts? Have not the threats increased since then? Are not our armed forces today experiencing a greater and more frequent range of operational demands than they did in the 1990s? Has the average interval of 24 months between tours for the infantry been achieved? On Tuesday, we learned that another 900 armed forces reservists were to be drafted to serve in Iraq. Is not one of the main reasons for that that there are not enough regular troops to deploy? After today's statement, there will be even fewer.
	The truth is that this statement is not about the welfare of our armed forces. It is not about the security of our country. We were promised new thinking. What we have today are tired old ideas heated up. In the end, it is all about saving money, and I predict that this will not be the end of it. These swingeing cuts to the Army must be seen alongside equally dangerous reductions in the number of surface warships and compulsory redundancies in the RAF.
	Our armed forces deserve better than to be betrayed in this appalling manner by their Government. This statement is bad for the country. It is quite simply wrong.

Geoff Hoon: First, may I extend the very good wishes of the Government and Labour Members to the hon. Member for Mid-Sussex (Mr. Soames)? We wish him a speedy recovery. I extend that on behalf of his many friends in the Ministry of Defence, among whom I count myself. There was some concern, however, at the strength of any new hip with which he would be provided. The research department of the Ministry of Defence is perfectly willing to provide some new materials to ensure that the replacement is fit for its purpose.
	I am sorry that the right hon. and learned Member for Devizes (Mr. Ancram) has approached this debate as he has chosen to do. Clearly, he had a choice: he could have seriously considered these issues, carefully considered the military advice that has been available to him and to Conservative Front-Bench Members, and approached the matter in a proper way. Instead, he has chosen to make party political points, which he is entitled to do, and has produced an entirely incoherent response to a set of carefully thought-out proposals based on the best military advice—[Interruption.]

Mr. Speaker: Order. Many hon. Members want to be called to ask a supplementary question, and this is a serious matter for many communities and their regiments. I do not want the Secretary of State to be barracked. He has been asked to answer questions, and he will do so. The House should remember that I can stop a statement at any time. I therefore remind those Members who are heckling of my position: I will not allow the Secretary of State to be barracked in any way.

Geoff Hoon: The incoherence of the right hon. and learned Gentleman's position is demonstrated by the fact that he claims to support the need to reorganise the Army, and appears to recognise, in saying so, that we need more support forces for front-line forces, but he insists at the same time, for party political reasons, that it is necessary, somehow or other, to maintain the same number in the infantry. Anyone who examines these issues—I appreciate that he does not do so on a regular basis—knows full well that if we are to deploy large numbers of infantry battalions in the way that we do at present, they must be properly supported. One simply cannot put down infantry battalions in Afghanistan unless they have an appropriate chain of communications to support them there.
	Therefore, this is not about cuts, and the right hon. and learned Gentleman and Opposition Members need to understand that. It is about ensuring that the 3,000 posts saved by the improved situation in Northern Ireland are used to support front-line forces. Unless he grasps that, unfortunately, he will do his party and the House a considerable disservice.
	Even more importantly, the right hon. and learned Gentleman talked about a grossly overstretched Army. He should look carefully at the figures. Which part of the Army is overstretched? I emphasise that it is not the infantry—if he listened to General Jackson on the radio this morning, he will have heard him make the same point. The tour interval for the infantry, on average, approaches 22 months. Inevitably, that disguises the fact that parts of the infantry are facing shorter tour intervals. The real question to which he must face up, and which the Opposition must start considering seriously, is that of tour intervals for the support elements. Those people are facing shorter tour intervals than the infantry battalions, and it would therefore be grossly irresponsible for any Government, or putative Government, to pretend that, to address overstretch, they will protect those parts that are less stretched than others. It is a simple, straightforward and undeniable point. If we are to ensure that we have deployable armed forces, they must be supported on those deployments.
	The right hon. and learned Gentleman made a great deal of the issue of numbers. We will preserve around the same number of people in our modern Army as at present—around 102,000. He needs to examine carefully, and the Conservative Front-Bench team need to think through a little more carefully than they have done so far, how many people were in the Army in 1997. There were far fewer than there are today. For his criticisms of Army numbers to have any validity, he should have addressed that issue when he was in government. He failed utterly to protect the Army when he was a Cabinet Minister, as there were a whole series of amalgamations and changes. It is simple hypocrisy to come to the House and pretend otherwise.

Paul Keetch: I, too, thank the Secretary of State for early notice of his statement, and send my best wishes and those of my right hon. and hon. Friends to the hon. Member for Mid-Sussex (Mr. Soames).
	Today's announcement has been much trailed and much speculated about, and we would expect some winners and losers. As the Secretary of State rightly said, there have always been changes to the armed forces, not least under the previous Conservative Government. We welcome some of today's announcements. We welcome the move to make the Army more mobile and rapidly deployable, but we have strong concerns about the cuts in infantry numbers, which could leave Britain with its smallest Army since the first Afghan war of 1839.
	We accept that the threat to UK security from terrorists and failed states is real. We must adapt our armed forces better to deal with those new threats. The old threats remain, however, and the old demands remain: peacekeeping, humanitarian intervention, and support to the civil powers during floods and foot and mouth. We accept that the logistics are overstretched, but how will that be countered by scrapping infantry regiments?
	Can the Secretary of State assure the House of Commons that no member of the armed forces will face compulsory redundancy as a result of the changes that he is announcing today? We welcome the addition to our special forces, for which we called two years ago in our paper, but where will the rangers unit be based? We are pleased that there will be no changes to the Territorial Army and the Gurkhas: that is absolutely right.
	The Black Watch is being retained in name only. Why could we not keep all the regimental names? We welcome the end of the arms plot, but it could and should have been done without the loss of numbers of battalions. Does that really send the right recruitment and retention message? Does it really encourage members of the public to join and stay in the armed forces?
	All the changes presume the continuation of peace in Northern Ireland, and no more overseas deployments. We sincerely hope that that is the case, but while it is possible to axe soldiers in one sentence in the House of Commons, it will take years to bring them back. Is the Secretary of State really confident that he will never have to do that?
	I have always recognised that there is a balance between the network-centric, high-tech forces that the Secretary of State wants to be able to work with the United States, and the more traditional capabilities—the boots on the ground—that we need today in Iraq, the Balkans and Afghanistan. We believe, however, that the balance is moving much too far away from the backbone of our armed forces—the men and women who work and fight with extraordinary courage and skill. There is a price to be paid for high-tech equipment. Today, four battalions of the Army have paid that price, and we believe it is a price not worth paying.

Geoff Hoon: The Army today is much larger than it was in 1997, and, even if we allow for these changes, it will still be larger than it was in 1997.
	I have made it clear that, in the light of the improved situation in Northern Ireland, we can reduce the number of battalions by four. Those posts—around 2,400—along with a further 600 not in infantry battalions will be reused across the Army, partly to strengthen existing infantry battalions where there are shortfalls but mainly to ensure that we have key enablers. Anyone who looks carefully at the way in which the modern British Army is deployed in the world must recognise that key enablers are vital. This is where the Conservatives have missed the point: we can have any number of infantry battalions, but if they cannot be supported in operations in hostile environments such as Afghanistan, there is no purpose in having them. They are there in name only, and cannot be used.
	The hon. Gentleman mentioned arrangements for the end of the arms plot. I assure him that our intention is precisely to aid retention. The biggest threat to retention, particularly among trained, experienced members of the modern Army, arises when they have to move home every two years. It is absurd that that practice should continue in the 21st century. Our proposals are entirely retention-positive: they will help us to retain in particular the best skills and the most able people, those who have had the most training in the modern Army. They are about ensuring that we have the right people with the right skills for the future.

Bruce George: I hope my right hon. Friend will accept that I am as relieved now as I was in 1991, when my local regiment survived "Options for Change" while many others were amalgamated into oblivion. I hope that he looks forward as enthusiastically as I do to his appearance before the Defence Committee, along with the Chief of the General Staff, shortly after our return from the recess. Will he explain—now or then—why the regiments that appear to have survived, and retain a name, a museum and a cap badge, can look forward to the preservation of their historical traditions and high competence? Does he accept that there is no incompatibility between a regiment's survival in reality and its operation in a more coherent regional framework?
	I look forward to early January.

Geoff Hoon: I too look forward to that opportunity. I am sure it will be possible for me to describe the new arrangements in even more detail than I have today.
	I should emphasise that in producing large regiments, a consistent ambition of the Army over many years, we have been guided both by military advice—the strong, firm, clear recommendations of the Army—and by a detailed consultation exercise, which has generated different responses in different parts of the country. Different areas have adopted different approaches. Indeed, the approach in Scotland is different from the approach in my right hon. Friend's part of the country—a part of the country that I share. Our actions, however, have been guided and steered by the Army itself.

Bernard Jenkin: Everyone must accept that issues relating to the arms plot need to be constantly revisited, but nothing can disguise the Secretary of State's prevarication over his plans to cut the target size of the Army. Why did the Government come to the House after their election in 1997 with the strategic defence review, proposing to increase the size of the Army to 108,500? It now emerges that they never achieved that and never intended to achieve it, because the money was never made available.
	As long as the Government continue to fit the armed forces into a Treasury envelope of the Treasury's choosing rather than matching the resources necessary to meet the demands made of the armed forces, they are taking risks with the security of the country and, indeed, with the lives of our armed forces.

Geoff Hoon: The truth is precisely the opposite of what the hon. Gentleman suggests. Let us assume that we had increased the size of the Army to 108,000. Had that been possible, it would have been based largely on extra infantry battalions. We would have faced exactly the same problem as the one that I have addressed today—the problem of how to support extra infantry battalions when they are actually deployed.
	As I am sure the hon. Gentleman realises, even since the strategic defence review we have seen a dramatic change in the strategic landscape. We used to organise our armed forces to face a single threat from the Soviet Union with a single line of logistics to support a large number of deployed infantry battalions. We now face multiple threats around the world, including those with which our armed forces must currently deal in Afghanistan. It simply does not make sense to organise the Army along that single line of communications. We need multiple, deployable battalions. I agree that infantry battalions are vital, but they must be supported, and they must be supported from within our existing resources.
	The number of people in the Army will still be greater than it was when the hon. Gentleman arrived in the House in 1997—greater than it was under the last Conservative Government.

Gavin Strang: Does my right hon. Friend agree that in a few years people will look back and wonder why infantry arms plotting survived for so long? The changes that he has announced will result in more deployability, and a more rapid response to overseas developments. Does he also agree that when our troops are in action overseas, it is vital for our soldiers not to have their tours extended beyond the standard six months, and, when they do come home, to have adequate time for training and recuperation?

Geoff Hoon: I entirely agree with my hon. Friend. He makes a point that, by implication, might embarrass Conservative Members: precisely the same proposals were made by the Army in 1962, in the 1980s and again in the early 1990s. The truth is that Conservative Governments did not have the courage or conviction to see them through. They were incapable of reorganising the Army along the lines that it advocated itself. That demonstrates just how feeble their approach is today. They are trying to pretend that they have never supported our approach, whereas in fact they simply could not see it through.

Robert Key: In the heartland of the British Army around Salisbury plain, of all places, the Secretary of State has just buried 300 years of regimental history. If he is re-elected to his constituency after the next general election, which may be unlikely, and if I too am re-elected—which is more likely, following today's statement—will he come to Salisbury at noon on the day after the election to see me sing the marching song of the Wiltshire regiment to celebrate the re-election of a Conservative Member?

Geoff Hoon: I doubt whether I will be celebrating any such thing, but I am certainly perfectly willing to join the hon. Gentleman and to discuss these changes, which have been approved and agreed by the Army itself.

Chris McCafferty: On behalf of my constituents in Calder Valley and those in Halifax—especially those currently serving in the Duke of Wellington Regiment in Iraq—may I warmly welcome my right hon. Friend's decision to form a Yorkshire regiment from the three current regiments? Although the Dukes are currently in Basra, they are very aware of the battle raging at home over their future and that of other regiments, which has made matters extremely difficult for them as they serve in an area of conflict. My right hon. Friend is absolutely correct to say that it is important that the Army be structured and equipped in such a way that it is flexible and can deploy rapidly, but I am very pleased that he has found a way of enabling that to happen without throwing out the baby with the bath water, allowing the Duke of Wellington Regiment's links and traditions to remain.

Geoff Hoon: I am grateful to my hon. Friend. What is important is that we preserve, as I have made clear today, the strong regional identities that are so important to the modern British Army. A Yorkshire regiment will continue that very strong tradition.

Stephen O'Brien: The Secretary of State's statement will have been greeted with utter dismay by the soldiers of the Cheshire Regiment and the entire population of Cheshire, who take deep pride in their county's close attachment to the regiment. Does he realise that there is much doubt about whether it is possible to generate the same loyalty and connection through simply a cap badge? In the past, recruitment to the Cheshire Regiment has always been successful because the soldiers knew that they belonged to their county, and they had a loyalty based on identification and support. I hope that the Secretary of State will now admit that today's statement was a gross error of judgment and understanding.

Geoff Hoon: Instead of dealing in rhetoric, the hon. Gentleman should deal in the facts, which are that the Cheshires will still recruit from an identifiable area, they will still have an identifiable name and they will be part of a multi-battalion regiment. That practice is wholly consistent with the rest of the Army, and it has already been adopted by about half the infantry battalions. Indeed, the Army has persistently and consistently recommended for a very long time that it be organised in accordance with that practice. I can assure the House that the views that the Army has taken into account are those of serving soldiers, rather than those of retired soldiers or people such as the hon. Gentleman, who was perhaps speaking for the benefit of his local newspaper.

Peter Pike: As my right hon. Friend will recognise, we all have strong attachments to our local regiments. Over the years, many regiments have gone, such as the East Lancashire Regiment, which had a particular connection with Burnley and that part of county. Indeed, when I was doing my national service in the Royal Marines in the 1950s, we expected the Royal Marines to go. Is it not a fact that my right hon. Friend has taken note as far as possible of local traditions and names, while at the same time ensuring that our Army is able to meet present and future requirements? I wish the new King's, Lancashire and Border regiment well in the years ahead.

Geoff Hoon: I am grateful to my hon. Friend. This detailed process was conducted in the first place by the Army, which took account of its regional organisations and listened carefully to their recommendations. That was particularly true so far as Lancashire was concerned. I can assure my hon. Friend that the Army's views on this issue have been uppermost in my mind in reaching the decisions that I have taken.

Annabelle Ewing: The Defence Secretary has announced today the end of the entire Scottish regimental system. As the MP for Perth, where the Black Watch has its regimental headquarters, I am amazed at his gall. The Black Watch has just returned home from the front line in Iraq, where it was sent because it was indispensable to the US army. Why, then, is the Black Watch not indispensable to this Government? Surely this is a massive betrayal of our brave soldiers, whose bravery can be contrasted with the Defence Secretary, who is nothing but a back-stabbing coward.

Mr. Deputy Speaker: Order. The hon. Lady must withdraw that remark immediately and apologise.

Annabelle Ewing: I have the utmost respect for you, Mr. Deputy Speaker, but I have no respect whatsoever for the Defence Secretary, and I am afraid that I cannot withdraw.

Mr. Deputy Speaker: Order. The hon. Lady is not helping herself. I suggest that she now withdraw that remark unreservedly.

Annabelle Ewing: As I said, Mr. Deputy Speaker, I have the utmost respect for you and your office, but I have no respect whatsoever for the Defence Secretary and I cannot withdraw.

Mr. Deputy Speaker: Order. The hon. Lady would be advised to take my advice without qualification and not compound her error. Will she now obey my instructions? Otherwise, serious consequences will follow.

Annabelle Ewing: For the reasons that I have twice given already, Mr. Deputy Speaker, I am afraid that I cannot withdraw.
	The hon. Member, having used a grossly disorderly expression, was ordered by Mr Deputy Speaker to withdraw the same, but she declined to comply with the direction; whereupon Mr Deputy Speaker, pursuant to Standing Order No.43 (Disorderly conduct), ordered her to withdraw immediately from the House during the remainder of this day's sitting, and she withdrew accordingly.

Ernie Ross: I welcome my right hon. Friend's statement, unlike those Members who have just left the Chamber. A colleague of mine, the Lord Provost of Dundee, was in Warminster yesterday talking to the soldiers and officers of the Black Watch, and not one of them had any complaints. In fact, they wanted to make it clear that the opinions of people such as those who have just left the Chamber do not represent the views of the serving soldiers in the Black Watch. The fact that my right hon. Friend has managed to retain the best elements of the regimental system, while allowing the soldiers of the Black Watch to balance professionalism with their family responsibilities, bodes well for the future of the Royal Regiment of Scotland. I am sure that the 3rd Battalion Black Watch, as part of the Royal Regiment of Scotland, will continue to play a major role in all future activities.

Geoff Hoon: I am very grateful to my hon. Friend. I had the privilege not only of meeting members of the Black Watch in Basra last week, but of meeting the Lord Provost of Dundee beforehand. I was grateful to him for his travelling to London to make his views known, and they are clear. He wants to preserve the best elements and the identity of the traditional regiments in Scotland, and he accepted the need for the re-organisation that we propose. We are reorganising to face the challenges of the 21st century, while having regard to the importance of regimental identities. That is the best way to proceed.

Several hon. Members: rose—

Mr. Deputy Speaker: Order. Let me assure the House that I do not want the Chair to take up more time than is necessary, given the limited time available, but I do now appeal for very short, concise questions. It will be impossible to call every hon. Member in the time available, but I will do my best—if each hon. Member will do their best for their fellows.

Peter Viggers: Is the Secretary of State aware that the Territorial Army has two roles? The first is to in-fill the regular Army, which makes it attractive to younger people with no responsibilities but less so to older people with family and business responsibilities. The second role is far more important: to provide a framework for expansion of the Army in times of emergency and the unforeseen. Does the Secretary of State recognise that fact, because he said nothing about it in his statement?

Geoff Hoon: I am grateful to the hon. Gentleman for the thoughtful way in which he puts his question. This is one of the challenges that the country has had to face since the appalling events of 11 September in particular. Before then, the emphasis was on changing the TA so that it could be used in support of regular forces, as he said. However, it is clear that today we must consider how we respond to domestic crises and provide military support for the civilian agencies, which would have to deal with such crises initially. Indeed, we have already addressed this issue by forming rapidly deployable regional TA groupings. We have made a significant start in that regard, but there is further work still to do.

Parmjit Dhanda: Can my right hon. Friend confirm whether the Glosters' name will be protected within the new regiment, and does he have a message for the thousands of people in Gloucestershire who have signed petitions calling for the retention of the back badge, which has been with the regiment since the battle of Alexandria in 1801?

Geoff Hoon: I was grateful to my hon. Friend for bringing to London a delegation from Gloucestershire, with whom we discussed the various issues affecting the Glosters. The precise details concerning the name still have to be resolved, but I can assure him that we are considering how the back badge, which forms part of the Glosters' great history and tradition, might be preserved.

Hugh Robertson: In 1991, I was an Adjutant of a regiment that was reorganised just after it returned from the Gulf war. I clearly remember that it marked the start of a period of considerable uncertainty and worry for those affected—for example, about promotion prospects, postings and the impact on families. Will the Secretary of State ensure that the manning and record offices, which implement the changes, have the necessary extra resources to make sure that the decisions are reached speedily, minimising the worry, disruption and upset for all those concerned.

Geoff Hoon: I am grateful to the hon. Gentleman, who makes an entirely sensible and practical point. I assure him that that will be attended to.

David Hamilton: Will the Secretary of State confirm that the £40 million of investment for the Glencorse barracks will go ahead and that the 500 personnel will be stationed there in the future? What use will be made of the barracks?

Geoff Hoon: I have no reason to change the present arrangements, as announced.

Tim Collins: What does the Secretary of State say to the tens of thousands of people across Cumbria who signed petitions in support of the King's Own Royal Border Regiment? They will be very saddened indeed at his decision today. Will he explain an anomaly in his statement? Why did he say, in respect of the reductions for the first three battalions, that he "decided" as recommended by the Army, but, in respect of the special forces unit, merely that an option "emerged" rather than being decided? Was that also recommended by the Army?

Geoff Hoon: It was recommended by the Army and I apologise if I did not make that clear in my statement. The Lancashire regiments took the view that the best way of reorganising arrangements was to have two merged battalions within a title that recognises the continuing history and tradition of the Border Regiment.

Gordon Prentice: The Royal Irish Regiment was excluded from the review, yet it recruits more Fijians—5.5 per cent.—than any other regiment in the British Army. What is the Secretary of State going to do to encourage recruitment in Ireland, and are there too many Fijians in the British Army in any case?

Geoff Hoon: There are certainly not too many foreign and Commonwealth citizens in our armed forces. They play a valuable role and I believe that it would be a sad day if they were turned away. It is wrong to set one part of our Army against another and I have already explained the reasons for not dealing with the Royal Irish at this stage, not least because of the very considerable changes that are under way in Northern Ireland.

Bob Russell: Will the Secretary of State confirm that the population of the 10 counties from which the Royal Anglian Regiment is recruited is greater than the population of Scotland, of Yorkshire and of Lancashire? Will he explain why those 10 counties continue to be under-represented in the footprint of recruitment to the British Army?

Geoff Hoon: There is necessarily a balance. I explained at the outset that the Army had taken account of the recruiting history, manning and experience of different regiments in different parts of the country. There is no doubt that Scotland recruits a disproportionate number of members of the Army, given the overall size of the UK armed forces. That is a great credit to Scotland, but saying that is not in any way to disrespect the efforts that are made in other parts of the country.

Lorna Fitzsimons: Will the Secretary of State confirm that the eleventh-hour proposals to cut one of the battalions of the Royal Regiment of Fusiliers have indeed been kicked into touch? Secondly, will he join me in congratulating Brigadier Roy Wilde, the colonel of the regiment, and the Rochdale Fusiliers Association—particularly its secretary, John Rogers—on the sterling work that they did to convince the Army Board to stick to its own criteria?

Geoff Hoon: I pay tribute to my hon. Friend for her vigorous representations on behalf of the units in her constituency and the immediate neighbourhood. She made her case extremely effectively and I am delighted that it was accepted.

Patrick Cormack: Does the Secretary of State accept that although there might be a degree of relief in the Staffordshire Regiment, there will still be concern in the county about how precisely its identity is to be preserved? There is also continuing incredulity that, when General Sir Mike Jackson made it plain that he would like to have had a larger Army on offer, it never was on offer. Why not?

Geoff Hoon: The Chief of the General Staff made his position very clear on the radio this morning. All Departments operate within finite resources. That is the way in which all Government Departments—those of all previous Governments, not just this Government—have had to function. The hon. Gentleman, as a fair-minded man, will recognise the importance of ensuring that we have the right balance of forces in order to support modern operations. It is vital to preserve— the hon. Gentleman will play his part in doing so—the history, tradition and reputation of the great Staffordshire Regiment.

Mark Tami: I welcome the new ranger unit in support of our special forces, but will the Secretary of State give us more information on the size and structure of that force and clarify when it will come into being?

Geoff Hoon: I have said that there are already arrangements in place for supporting our special forces. It is not right for me to go into precise detail about that. I also made it clear in my statement that we will develop the capability over a period of time. It is an important way of enhancing the ability of our special forces, particularly at a time when they are used more than every before.

Michael Jack: Will the Secretary of State confirm that the word "recruitment" does not appear in his statement? In that context, what objective evidence can he offer that recruitment to the regiment that now replaces the Queen's Lancashire Regiment will not be harmed by the loss of the QLR's proud name and reputation?

Geoff Hoon: If the right hon. Gentleman checks, he will see that the word "recruitment" appears several times, because it is so vital.

Michael Jack: indicated dissent.

Geoff Hoon: The right hon. Gentleman shakes his head, but it is there and I made specific reference to recruitment because of the Ministry of Defence's experience of dealing with the consequences of "Options for Change". Those processes resulted in a freeze on recruitment over a long time. That was a terrible mistake because it meant that, 10 years after the freeze, we lacked the NCOs and others who should have had 10 years' experience at a critical time for our armed forces. The whole point is to rebalance and maintain the requirement for recruitment. That is why I set it out so clearly in my statement.

Nigel Beard: I congratulate my right hon. Friend on the changes made to the shape of the Army, which match the new challenges facing defence forces in the 21st century and improve the scope for people who serve in the Army to have a stable home life.

Geoff Hoon: Again, I am grateful to my hon. Friend. It is important in ending the arms plot that we look at the reasons for doing so. It is partly about having more battalions available for operational duties, but a crucial other aspect is to assist retention by providing our armed forces and their families with a greater degree of predictability and stability in future.

Patrick Mercer: May I correct a misapprehension of several Back Benchers on both sides of the House? The English and Welsh regiments will lose their names, lose their cap badges and, where appropriate, lose their hackles and other regimental appointments: the Scottish regiments will not. With the exception of the King's Own Scottish Borders and the Royal Scots, they are maintaining their names in brackets before the future regimental name. I know that it is all sentiment to the Secretary of State, but to those who have served in these regiments, it is not sentiment, but crucially important. I believe that the right hon. Gentleman is dealing unfairly with the English and Welsh regiments.

Geoff Hoon: I do not accept that. The recommendations came from the regional groupings and I know that the hon. Gentleman is wholly familiar with the way in which these matters are decided. I have also made it clear that, as far as possible, the traditional accoutrements can be preserved right across the country, not simply in Scotland. As the hon. Gentleman will be aware, the crucial thing about the structure of our armed forces is regimental identity. That is what will remain so important for the future of these regiments.

Martin Salter: Will the Secretary of State explain more clearly how the identity of the Royal Gloucestershire, Berkshire and Wiltshire Regiment as a whole will be protected in the new merged structure that he has outlined, because it was not that clear from his statement? Will he also confirm that the RGBW is itself the product of a county merger authorised in 1994 under the previous Government?

Geoff Hoon: My hon. Friend is entirely correct on his last point. I set out a rather complicated arrangement for the future of the constituent elements of the RGBW. Essentially, the Glosters will go in one direction and the former regiment that was merged into the RGBW will go in a different direction. I am certainly willing to write to my hon. Friend with more detail about how those arrangements will be achieved.

Roy Beggs: I sympathise with those loyal service men and women and their families who are most affected by today's announcement of a reorganisation and modernisation of our armed forces. I welcome the fact that the Royal Irish Regiment has been exempted, but will the Secretary of State say for how long that will apply? Will he assure the House that that regiment will not become a political football, subject to the negotiations on Northern Ireland's future?

Geoff Hoon: I will not allow that to happen. That is precisely why I felt it appropriate not to make a decision in relation to the Royal Irish Regiment. As the hon. Gentleman will know—and the representations that I have received from other Northern Ireland Members make it clear that they also recognise this—there are inevitable consequences of normalisation in Northern Ireland, and the military implications are inevitable. I am sure that he will welcome that, on behalf of the people whom he represents.

Andrew Miller: A paper submitted on a joint basis by hon. Members representing constituencies in Cheshire held that the county identity should be protected within the battalion if there were to be a larger grouping in the Prince of Wales Division. I welcome that aspect of my right hon. Friend's important statement, but he now has an opportunity to address some of the appalling housing issues faced by Army personnel. They are quite different from those that affect the other services. Will he make it his business to ensure that my constituents serving in the Cheshire Battalion of the Mercia Regiment are properly and adequately housed, to the standard that people should expect today?

Geoff Hoon: I am grateful to my hon. Friend for that question, and for the representations that he has made along with other hon. Members from Cheshire. There is no doubt that, in the course of this process, I have considerably enhanced my knowledge of military history. I agree that it is important to preserve that history, and our military traditions and reputation. However, one of the consequences of ending the arms plot and the resulting greater stability for our Army personnel and their families is that we will have to look still harder at the question of accommodation. We inherited a disastrous situation in 1997 as a result of the previous Government's outrageous decision to sell off military housing to Annington Homes. That was a short-term quick fix. The right hon. and learned Member for Devizes (Mr. Ancram) was in the Cabinet at the time, and he knows that that decision was dictated by the Treasury and the then Chancellor of the Exchequer. It was a disgraceful decision and it has taken us a great deal of time to recover from it.

Nicholas Winterton: As a representative from the proud county of Cheshire, I deeply regret the Secretary of State's announcement about the Cheshire Regiment. Will the regiment be allowed to keep its cap badge? Does he understand that some Conservative Members who, unlike him, have served in the Army believe that he has misrepresented the statistics relating to the Army establishment? In 1997, the number of TA and full-time Army regulars was greater than it is today.

Geoff Hoon: I am terribly sorry, but I am not going to allow the hon. Gentleman to get away with that. Were he talking about Alistair Campbell's activities in the same terms, he would describe it as spinning. There is a clear figure for the size of the regular Army, and I quoted regular Army statistics to the House. I did so absolutely accurately. I am afraid that I do not recall the hon. Gentleman making the same complaints in 1997 about the disgraceful size of the Army under the previous Government.

Nicholas Winterton: I did, I did.

Geoff Hoon: If the hon. Gentleman did make such vigorous complaints at that time, I certainly apologise to him now. As I made clear in response to the question from the hon. Member for Newark (Patrick Mercer), what is important about our armed forces' regimental structure is that there is a regimental identity. That is the answer to the question: the regiments to which the hon. Gentleman refers will have a regimental identity.

Frank Roy: I assure my right hon. Friend that I have no intention of carrying out a pathetic stunt such as the one perpetrated by members of the Scottish Nationalist party in relation to his plans for Scottish regiments. Those hon. Members seem to want to disband the whole British Army. In respect of the merger of the Royal Scots and the King's Own Scottish Borderers, there is a worry in Lanarkshire and Dumfriesshire that the names might be lost. Will he confirm that both names will be retained?

Geoff Hoon: I am grateful to my hon. Friend for raising that important point. I confirm that the merged battalion name will include both titles, the Royal Scots and the King's Own Scottish Borderers. I want to take this opportunity of responding to the observations made by the Scottish Nationalists. Members of that party do not believe in membership of NATO, nor in European defence. They have opposed every deployment of British troops in recent years. I wonder what the point of having an army in the UK would be if that party ever got into any kind of power anywhere.

James Gray: The people of Wiltshire will regret very much the obliteration of 300 years of history with the Wiltshire Regiment, which served with such distinction in the second world war. Will the right hon. Gentleman not rise above his Islingtonian mediocrity and acknowledge the excellence of institutions like the Wiltshire Regiment? He talks about regimental identity. Wiltshire is the home of the British Army: surely that is worth acknowledging?

Geoff Hoon: Unlike the hon. Gentleman, I have sought to approach this matter in a balanced way, using the best military advice. It is important that we look at these proposals in the way that the Army recommends. We have used the best military advice available to us. I am sure that the hon. Gentleman believes that he is better at providing military advice than the Chief of the General Staff, but this is what the Army has proposed.

David Crausby: I completely accept that we must achieve a sensible combination when it comes to keeping up with American technology and retaining the number of troops that we can afford. However, we are unlikely to tackle the threat that faces us without the Americans. Does my right hon. Friend accept that the priority should be boots on the ground, rather than more and more technology?

Geoff Hoon: That point is often made, but it is very important that we resist it. There is no trade-off between boots on the ground and technology. Modern technology will assist in war fighting as much as in peace keeping. A lot of modern technology that I described in my statement today is about providing information, communications and a technological approach to both war fighting and peace keeping. We must make sure that deployed forces have up-to-date and accurate information, which they can share. That is crucial to peace keeping. Given today's situation in places such as Iraq, it could be argued that it is more important to peace keeping even than to war fighting.

John Burnett: For centuries, the Royal Marines have been an integral part of the Royal Navy. That arrangement has served the country outstandingly well. Will the Secretary of State confirm that the Government have no plans to change that structure? Will he confirm too that badged swimmer canoeists will remain full members of the naval service, even though their operational tasks will continue to be dictated by another organisation?

Geoff Hoon: I shall not pursue the hon. Gentleman's final observation too far, for reasons of which he is aware. However, I assure him that there are no plans to change the structure of our armed forces as far as the Royal Marines are concerned.

Iain Luke: No one can condone the actions of Scottish Nationalist Members today, but does my right hon. Friend accept that sadness and anger will be felt throughout Scotland as a result of his decision? What consideration was given to the proposals from the civic heads of Dundee, Perth, Angus and Fyfe and the Black Watch Association for an alternative structure for the Scottish Brigade? Will he meet them again to explain what safeguards he will put in place to ensure that the identity of the Black Watch is safeguarded and fostered in the Royal Regiment of Scotland?

Geoff Hoon: As I have said already, I had a very good meeting with the gentlemen representing part of the Black Watch recruiting area. They were at pains to make it clear that they recognise the necessity of reorganisation and to emphasise the importance of identity. As I said earlier, that is what has guided our proposals. We must reorganise our armed forces to reflect the challenges that we face in the 21st century, and combine that with real sensitivity about identity. I believe that we have achieved that in Scotland and in the rest of the country.

Angela Browning: May I express my personal sadness, which is felt by many in the west country, that the Secretary of State attempted to airbrush the Devonshire and Dorset Regiment out of history? If retention and recruitment are to remain so important in Army life, why is the policy now that people who want to leave the armed forces are actively encouraged to go as quickly as possible?

Geoff Hoon: I have not airbrushed any regiments out of history. What I have sought to do is to find a way in which their structure can reflect the kinds of challenge that we face in the 21st century at the same time as recognising their identity. I accept that the hon. Lady has vigorously put forward the case of the Devonshire and Dorset Regiment. It will be important, as has happened in previous amalgamations, that its history is carried through into succeeding regimental organisations.

David Borrow: From discussions with my local regiment in Lancashire, the Queen's Lancashire Regiment, I am given to understand that agreement was reached between the three regiments to the west of the Pennines that if a merger were to take place the appropriate name would be the Royal Lancashire Regiment. Can the Secretary of State confirm that that name was recommended to him by the Army Board? If the name was different from that recommended by the regiments, why was it? If he overturned the recommendation of the Army Board, will he explain why he did that?

Geoff Hoon: My hon. Friend is right that in each part of the country a number of options have been discussed and various proposals put forward. I confirm that I have heard the suggestion that the regiment could be called the Royal Lancashire Regiment, but I assure him that the recommendation I have set out to the House is the recommendation that I received from the Army Board.

John Greenway: There will be considerable relief in Yorkshire and the north-east at the retention of the name of the Green Howards. Will the Secretary of State consider carefully, however, what my hon. Friend the Member for Newark (Patrick Mercer) said about how his statement appears to suggest that English regiments are being treated differently from those in Scotland? We need to retain our cap badges. On the ending of the arms plot, will the new Yorkshire regiment be based in Yorkshire?

Geoff Hoon: Let me take the hon. Gentleman's last point first. He has studied carefully the stabilisation of the Army with the gradual ending of the arms plot, and he knows full well that it cannot happen overnight. Remnants of the arms plot must continue, but it will slow down until it reaches a logical conclusion. At that point, consistent with the answers that I have given to other hon. Members, we will consider the stability of the future regiments. It certainly seems appropriate, where we can, to base the new regiments in those areas from which they draw their members. Equally, however, there are some concerns about that idea in the serving Army. Too close a location to home can sometimes produce wholly different problems, which we are seeking to avoid. If the hon. Gentleman will bear with me, the matters he raised are consequential on these announcements.

David Drew: My right hon. Friend had some helpful things to say about the Glosters and their back badge. He will know that that badge was earned by soldiers fighting back to back, not quite knowing where the attack was coming from. With that in mind, does he accept that there is confusion in the west country about exactly what his proposals mean? Will he meet local MPs to explain the repercussions and to tell us there will not be death by reorganisation? Can he give some idea of the timetable of the changes? We know what we have been through in the past, and change is upsetting, taking a lot of effort to get it right.

Geoff Hoon: I have already met at least one hon. Member from Gloucestershire and am certainly willing to meet more. I accept that the proposal relating to the RGBW is complex. I certainly undertake, as I already have undertaken, to look carefully at proposals for the retention of the back badge. I recognise how important that is to the identity of the Glosters.

Mark Francois: The Secretary of State knows full well that the Army comprises both the regulars and the territorials. He also knows full well that, given the large-scale cuts in the TA under the Labour Government's strategic defence review, the overall size of the Army is now considerably smaller than it was in 1997. The cap badges of the regular units are going to go, and we have this afternoon witnessed a slaughter of the innocents by a Secretary of State for Defence who does not even understand his own statement.

Geoff Hoon: The hon. Gentleman should have given some evidence for his last assertion, but I am perfectly willing to debate it with him. I am sure that the House will have many opportunities to do so. The hon. Gentleman normally speaks very effectively about Army matters, and I am sure that he is not suggesting that the size of the regular Army should include the TA simply for the purpose of making a convenient party political comparison.

Several hon. Members: rose—

Mr. Deputy Speaker: Order. We must move on. The recommendation from the Modernisation Committee was that statements should take an hour. We have had an hour and a quarter. I have tried to move strategically around the country, but I apologise if any sensitivity has been overlooked. That has not been intentional.

Business of the House

Peter Hain: The business for next week will be as follows:
	Monday 20 December—Second Reading of the Identity Cards Bill.
	Tuesday 21 December—Motion on the Christmas recess Adjournment.
	The business for the week after the Christmas recess Adjournment will be:
	Monday 10 January—Second Reading of the Clean Neighbourhoods and Environment Bill.
	Tuesday 11 January—Second Reading of the Road Safety Bill.
	Wednesday 12 January—Second Reading of the Child Benefit Bill.
	Thursday 13 January—Second Reading of the Consumer Credit Bill.
	Friday 14 January—The House will not be sitting.
	The provisional business for the week commencing 17 January will include:
	Monday 17 January—Second Reading of the Constitutional Reform Bill [Lords].
	On behalf of the whole House, I wish all right hon. and hon. Members and all staff and officials of the House, who have worked tirelessly throughout the year, a merry Christmas and a happy new year.

Oliver Heald: I join in the sentiments that the Leader of the House has just expressed, and I wish you, Mr. Deputy Speaker, the Leader, Members on both sides and all who work here a very happy Christmas.
	Has the Leader of the House read early-day motion 404?
	[That this House expresses its deep concern that during the debate on consideration of the Mental Capacity Bill on 14th December, a document relating to and important to the debate was not made available by Ministers to honourable Members in all parts of the House, but only to Labour honourable Members, namely a letter from the Lord Chancellor to the Archbishop of Cardiff; considers that it is a matter of constitutional importance that all relevant documents referred to by Ministers in the House should be made available to all honourable Members; notes the remarks of the Lord Chancellor on the Today programme of 15th December that the correspondence took place at around lunchtime and was sent straight down to the Commons and distributed around the Commons; further notes that despite these remarks the letter from the Lord Chancellor was not available in the Vote Office at 3.45 p.m.; applauds the ruling of Mr Deputy Speaker that this should not happen again; and calls on the Leader of the House to make a statement giving such an assurance on behalf of the Government.]
	The Leader of the House must understand how annoyed hon. Members were by the shambles that led to only Labour Members seeing the important letter from the Lord Chancellor. The rest of us, and even some on the Labour Benches, were left trying to make out its contents from the rather difficult remarks of the Under-Secretary of State for Constitutional Affairs.
	As was made clear from the Chair, we should all receive the same information for a debate. Will the Leader of the House make sure that that happens in future? Will he also ensure that if amendments come from the other place, adequate time will be allowed for a full debate on a particularly sensitive Bill?
	Has any progress yet been made in arranging the debate for which I have been asking on foreign affairs so that we can discuss the situation in Africa and the middle east? The Leader of the House will know from this morning's Law Lords' judgment that it has been declared that under the provisions of the Anti-terrorism, Crime and Security Act 2001 the detention of prisoners at Belmarsh is illegal. Given that the Government have always insisted that that imprisonment was perfectly all right legally, can we have a statement in which the advice given to Ministers and the statements of Ministers are explained? Clearly, the situation is worrying.
	The Gambling Bill is approaching its final day in Committee. The Government have today decided to revise the basis of the Bill completely. Can the Leader of the House assure us that we will have at least two days on report to consider the Bill now proposed?
	In the summer, I criticised the Leader of the House for changing guidance to allow Ministers to avoid answering written questions by replying that there was no time to answer before prorogation. Ministers have used that, but can he say why, according to the Library, so many of his colleagues have gone a stage further and cannot even be bothered to answer the questions at all? A whopping 306 written questions went totally unanswered in the last Session. Why?
	When will the Leader of the House change Standing Orders to allow the European Scrutiny Committee to sit in public? The Committee asked for that a year ago, and it would provide an early-warning system for excessive European regulation. Why is the Leader of the House dragging his heels on that?

Peter Hain: It is not a question of dragging my heels. As the hon. Gentleman very well knows, since he sits on it, the Modernisation Committee is looking at the question of proper scrutiny of European business by the House, particularly on the Floor of the House.
	On the Mental Capacity Bill and the scenes that occurred on Tuesday, I agree with the hon. Gentleman and give the assurance that in future the same information should be shared with the whole House, especially both Front Benches. The Speaker has written to the Lord Chancellor about the events of Tuesday. As Leader of the House, I take seriously any mistakes made by Departments in their day-to-day dealings with the House. All officials are required to respect the courtesies of the House. Mistakes were made, and lessons have been learned within the Department for Constitutional Affairs. My private office has been in contact with the Department to remind it of the correct procedures for depositing papers in the House and the courtesies that should be shown to all Members. I also spoke myself to the Lord Chancellor this morning.
	The hon. Gentleman requested a foreign affairs debate on Africa and the middle east. I understand the case for it. It is a strong one. We are looking into it, but a whole number of Second Reading debates on important legislation—I am sure he would recognise that—are to take place. If he were content with a debate in Westminster Hall, we could look at that in a different context.
	As the hon. Gentleman will realise, the Law Lords' judgment on the Belmarsh matter was handed down only earlier this morning. The Home Secretary has deposited with the House a written statement and perhaps it would be for the convenience of the House if I read a key part of it. The Home Secretary says:
	"The Law Lords have upheld the appeal by those detained under the Anti-terrorism, Crime and Security Act and we need to study the judgment carefully, not least because the Court of Appeal had unanimously endorsed our view that these provisions were compatible with our obligations under the European Convention on Human Rights. It is ultimately for Parliament to decide whether and how we should amend the law. The part 4 provisions will remain in force until Parliament agrees the future of the law. Accordingly I will not be revoking the certificates or releasing the detainees, whom I have reason to believe are a significant threat to our security, a judgment upheld by the Special Immigration Appeals Commission, chaired by a High Court judge."
	That is the key extract from the Home Secretary's statement, which is available in the Vote Office.
	Two new sittings of the Standing Committee on the Gambling Bill are due to be scheduled on 11 January. That has to do with a Government amendment to cap the size of existing and medium-sized casinos—an issue which has arisen during consideration of the Bill.
	If Departments are not answering questions, they should. If it is brought to my attention that Departments are not answering questions, and the hon. Gentleman quoted a figure of 306—

Oliver Heald: Seven hundred and six.

Peter Hain: Seven hundred and six is even less satisfactory. In the summer I introduced a new procedure whereby written replies would be not just deposited in the Library where they might gather dust and nobody in particular might know about them, but placed on the record in Hansard. I am sure that the whole House welcomes that extra scope for accountability.

Paul Tyler: I welcome what the Leader of the House has just said about the way in which the Mental Capacity Bill was handled. All Members will welcome the actions taken on our behalf. I endorse also his good wishes to you, Mr. Speaker, other Members and staff.
	Can the Leader of the House give an absolute assurance that Sir Alan Budd's report will be published before the House rises next week? Some very important issues are involved. If, as we now understand, the Home Secretary was not at fault, somebody else in the Home Office was, and clearly the new Home Secretary needs to take action.
	On the Belmarsh detainees, it is extraordinary that the Leader of the House comes here and reads out part of a letter. [Hon. Members: "A statement."] Part of a statement, then. Either the Home Secretary is prepared to make a statement to the House about why his predecessor's policies have now been declared unlawful by the highest court of the land, or it does not wash. For the Leader of the House to read part of a statement is unsatisfactory. Can he give us an absolute undertaking that before the House rises for the recess the new Home Secretary will declare exactly what the Home Office will do? Surely here is an opportunity for a new Home Secretary to make a fresh start on something that causes huge concern on every side of the House. We look to him to do that.
	May I draw the attention of the Leader of the House to the fact that my hon. Friend the Member for Winchester (Mr. Oaten) has put forward practical proposals to make sure that those who are detained could be charged and brought to trial without endangering our security services? Members on both sides of the House would wish that to happen.
	When can we expect a statement and debate on the report of the Electoral Commission into the funding of political parties and the democratic process? The Leader of the House will agree that it is scarcely satisfactory for maverick millionaires to be able to buy parties and their policies. It is not doing any good to the battered reputation of Parliament, of which he is the prime defender. Surely he must recognise that we need to debate the matter urgently. As I understand it, nobody is now in principle against state funding. After all, since 1997 the Conservatives have benefited to the tune of some £30 million of taxpayers' money, so they can scarcely have any principled objections. Is it not time that we looked at this carefully and made sure that funding was more transparent, fairer and attuned to encouraging local participation in our democratic process?

Peter Hain: I am very sympathetic to the hon. Gentleman's point about public funding for parties, which already takes place on a huge scale, although if taxpayers find out—he has conveniently told them—that the Conservatives have had £30 million, they will recognise it as bad value for money. Taxpayers have not got a good deal there. It is interesting that today's report from the Electoral Commission says that since being in opposition the Conservative party has found it increasingly difficult to attract individual and company donations and in 2003 reported that close to a third of its income came in the form of public spending. The year before, more than half of the Conservatives donation income was from public funds. We can move forward on a consensual basis on this and the Electoral Commission provides an interesting way of doing so.
	I am grateful to the hon. Gentleman for his remarks on my clear statement on the handling of the Mental Capacity Bill on Tuesday—something that I do not want to see repeated.
	It is for Alan Budd to decide when to report. He will report when he is ready to do so. If I may, I shall put into perspective the comments on Belmarsh. The Home Secretary has come to the House with a written statement at the earliest opportunity—

Eric Forth: He has not.

Peter Hain: I am sorry, but he has come with a written statement, a copy of which I have here and the key paragraph of which I quoted. I would have thought that that explained the matter clearly. The right hon. Gentleman will have a chance to study that statement and see the Government's position.

Eric Forth: No.

Peter Hain: This is the written statement, right before the House here. That is the answer to the point. The right hon. Gentleman is now supporting the Liberal Democrats as a coalition partner in making this point.

Kate Hoey: Has the Leader of the House seen early-day motion 394 concerning the threat to the postal services in the House?
	[That this House congratulates the postal staff in the Palace of Westminster for their continued excellent service and loyal dedication; is alarmed that the House authorities are intending to privatise the post services and have already contracted out screening of mail entering Parliament to an American company; and calls on the Serjeant at Arms to reconsider immediately.]
	Can he tell us which Members were involved in any decision taken to put out to tender the screening process, which has now gone to an American company, and who made the decision to put our postal services out to tender? Will he join me in saying what a great job the Royal Mail staff in the House have done for a long time? Will he ask the Serjeant at Arms to withdraw the instruction to tender? At least will he explain to the House under whose instruction that happened?

Peter Hain: I am certainly glad to join with my hon. Friend in praising the work of the Royal Mail staff here over many decades, if not centuries. As a fan of the Royal Mail I am disappointed that it did not get the contract for mail screening. I have looked into the matter, however, and I am content that all the correct procedures were followed. As a result of the tendering exercise, which was a legal requirement, the tendering panel decided, unanimously I understand, that the contract should be awarded to a company that could provide the required level of service. The Board of Management took the view, I understand, that the facility offered by the Royal Mail in this instance would not have provided the correct levels of screening that had been identified in the tender document. However, there is still the opportunity for the Royal Mail to bid for the internal mail delivery contract, which is now out to tender. The Board of Management had to put it out to tender because it would otherwise have been open to legal challenge. As Parliament needs to protect public funds, the House could not justify significant price increases which, I am afraid, the Royal Mail suggested for maintaining the same level of service. I hope that it puts in a strong tender.

Douglas Hogg: May I revert to the question of the Lords' ruling on the detainees in HMP Belmarsh? The Leader of the House will know that I and many others have been pressing on that matter for many months now and asserting that their detention was unlawful. Next week, may we have a full debate or a full statement from the Home Secretary? He has apparently asserted in a written statement that he will not comply with the judgment of the House of Lords and that he will continue to detain those people, notwithstanding the fact that that is unlawful. That is surely a disgrace and the House needs to have the opportunity to determine why the Home Secretary is prepared to defy the House of Lords.

Peter Hain: There is no question of the Home Secretary defying the House of Lords. I shall quote another part of the written statement for the right hon. and learned Gentleman's benefit. The Home Secretary says:
	"I will be asking Parliament to renew this legislation in the new year but in the meantime"—
	this is the key point—
	"we will be studying the judgment carefully to see whether it is possible to modify our legislation to address the concerns raised by the House of Lords."
	The right hon. and learned Gentleman will also have noted the point on which I quoted the Home Secretary earlier, which was that the Court of Appeal unanimously endorsed the Government's view that the provisions were compatible with our obligations under the ECHR.

Alice Mahon: Has the Leader of the House had time to look at early-day motion 377 about the return of the refugees to Falluja?
	[That this House condemns the decision taken by the interim Government of Iyad Allawi to take DNA samples, fingerprints and retina scans of the residents of Fallujah when they are allowed to return to their homes on Christmas Eve; regrets the decisions to insist that residents have to wear badges, and to treat refusal as an offence; and believes that these requirements have sinister historical overtones.]
	That will take place on Christmas eve, when the eyes of the west will be looking elsewhere. The people will have to go through checkpoints, be fingerprinted and DNA tested and, in many cases, will be going back to rubble. Even more sinisterly, they will have to wear a badge, which will be compulsory. That has certain sinister overtones historically. When can we have a debate on what happened in Falluja, where the people are, what aid has been given to them and what the centre of Falluja looks like now, after the Americans bombed it?

Peter Hain: I am sure that the Secretary of State will want to look very carefully at the points my hon. Friend makes.

Andrew Murrison: The Extradition Act 2003 allows UK citizens to be removed to the US without prima facie evidence or reciprocity, to the very great disadvantage of Mr. Giles Darby, my constituent, and others. Will the Leader of the House make time for a debate on that particularly perverse aspect of the special relationship?

Peter Hain: I cannot promise the hon. Gentleman an early debate, but he has the opportunity to apply for an Adjournment debate in the normal way.

Jeremy Corbyn: May I take the Leader of the House back to the issue of Belmarsh and the decision made by the Law Lords this morning? I cannot understand why the Home Secretary cannot come here and make a statement. If he is able to make a written statement, he can make an oral statement. These are very serious issues. The Law Lords have said that it is not correct to hold people indefinitely in a prison in this country on the signature of a politician. Unless a case has been taken out against those individuals in the criminal courts—there are no signs of that happening—the logic of the ruling is that they should be released. The Home Secretary should come to the House and explain his policy on these matters. We have been found wanting by the highest court in the land and it is up to us to respond and—I hope—accept that judgment.

Peter Hain: As I have explained, my right hon. Friend the Home Secretary has given a very full written statement. Home Office questions will take place on Monday, so in a couple of days my hon. Friend will be able to put those points to the Home Secretary. He has acted promptly in bringing a statement to the House at the earliest opportunity. Of course, in the end the House has the final say and will be the sovereign authority on the legislation.

George Young: Will the Leader of the House now answer the question put to him earlier about the report from the Electoral Commission? It makes recommendations that would reduce the dependence of all parties on large donations and would encourage smaller ones, a proposition that the Government resisted earlier. Can he find Government time for an early debate on that report?

Peter Hain: I am very sympathetic to the idea of a debate on that and I should be interested to see whether the shadow Leader of the House pressed for one as well. It might be possible, on an all-party basis, to move towards extending—not introducing for the first time, but extending—public funding for parties in designated areas. The Electoral Commission suggests, for example, increasing the policy development fund, which is some £2 million at present. Such a move could connect parties more closely with civic society and their local communities. In that respect, it is interesting that the Electoral Commission has recommended tax relief on donations of up to £200. We can consider the proposals in due course, but such matters are best addressed on an all-party basis, because all parties have already benefited to the tune of millions of pounds of public funding over the years.

Bill Tynan: My right hon. Friend will be aware that the Niger delta produces 20 per cent. of oil supplies at present. However, the population of the area has a major problem with armed gangs running riot. I join the calls for an international affairs debate on the Floor of the House in Government time to look carefully at the whole international scene and the deterioration of the situation in the Niger delta.

Peter Hain: I visited the Niger delta when I was Africa Minister and I know that the points my hon. Friend raises are valid. I cannot promise him an early debate, but I am sure that my right hon. Friend the Foreign Secretary will want to bear in mind the points that my hon. Friend makes.

Roger Williams: The Leader of the House will be aware that before he entered the Chamber, the Secretary of State for Defence made a statement on the reorganisation of British infantry. Numerous hon. Members were unable to question the Secretary of State on that statement, despite the best efforts of Mr. Speaker and Mr. Deputy Speaker to call hon. Members from across the country, and the fate of the Welsh regiments was not addressed. The Leader of the House will know, as he is also Secretary of State for Wales, of the concern in Wales about the issue. Indeed, we have the barracks in Brecon, and training of all UK infantry takes place at Sennybridge in my constituency. Will he try to find Government time for the issue to be debated once again on the Floor of the House?

Peter Hain: I visited both Sennybridge and Brecon to see the Army establishments there. The hon. Gentleman will be encouraged to know that Commander Ian Cholerton will shortly hold a press conference in Cardiff to welcome the news as far as the regiments in Wales are concerned.

Michael Clapham: Shortly before I came into the Chamber this afternoon, I received information from my constituency that Parkside International, which owns a factory in the small town of Darton in my constituency, will tomorrow announce the closure of that factory through the receiver, with the loss of 437 jobs. The union on site tells me that suggestions of management malpractice have been made. It is not the first time that Parkside International has closed factories in that way. My constituents, especially those in the small town of Darton, will suffer intolerably because there will be no enhanced redundancy and they will not be able to get their redundancy pay for six to eight weeks. Some people will have a very bleak Christmas.Will my right hon. Friend ask the Department of Trade and Industry to watch for the receiver's report, scrutinise it to see if any management malpractice took place and, if so, take the appropriate action? At the same time, will he—

Mr. Deputy Speaker: Order. That is a long enough question.

Peter Hain: I will certainly ask my office to contact the DTI right away and ensure that it is aware of the serious situation in my hon. Friend's constituency, especially with the plight of the work force.

Eric Forth: Given the insultingly short time that the Government will allow Committees to scrutinise the Serious Organised Crime and Police Bill and the Commissioners for Revenue and Customs Bill—and, I suspect, the Identity Cards Bill—does the Leader of the House expect the House of Lords to expect a correspondingly longer period of time to give proper scrutiny to those Bills? Sadly, the amount of time that the Government allow this House to scrutinise Bills is so short that we must look to the House of Lords to perform the function of parliamentary scrutiny for us.

Peter Hain: I have difficulty with the idea of the right hon. Gentleman as the champion of the House of Lords, but perhaps he wants a move down the Corridor. I enjoy his bellicose questions from the Back Benches, just as I used to do when he asked them from the Front Bench.

Paul Flynn: May we debate early-day motion 13?
	[That this House agrees with Simon Hart, Chief Executive of the Countryside Alliance, that his organisation would be ridiculed in parliament on the publication of a letter sent by the Masters of Fox Hounds Association to 800 hunt masters warning of the nationwide 'shortage of foxes' and urging landowners to breed more foxes to 'solve the problem'; and welcomes this further evidence that foxhunting is unconnected with pest control but is devoted entirely to sadistic pleasure derived from the protracted torment and death of foxes.]
	It draws attention to a letter sent by the Masters of Foxhounds Association to 800 hunt masters, complaining about the shortage of foxes and demanding action against farmers and landowners who refuse to breed foxes. Does not that prove absolutely that there is no connection between fox hunting and pest control and that the whole purpose of fox hunting is the pleasure gained by the hunters from chasing, tormenting and killing a small, defenceless animal that has been bred for that purpose?

Peter Hain: As always, I admire the eloquence and wit of my hon. Friend on that and other matters.

Andrew MacKay: Returning to the Law Lords' significant judgment today on the Belmarsh prisoners, does not the Leader of the House understand that a written statement from the new Home Secretary is wholly inadequate, because we cannot question him? To suggest that Home Office Question Time on Monday is any substitute, when, due to the shuffle, there may be no relevant opportunities, is also inadequate. Will he pass on to the new Home Secretary that that arrogance is unacceptable and that he has started at his Department in an unsatisfactory way?

Peter Hain: I am really disappointed that the right hon. Gentleman, who is a serious parliamentarian, seeks to make a point in that aggressive fashion. The judgment was handed down earlier this morning, about mid-morning. The Home Secretary made a written statement right away. When he has studied the document in detail, I am sure that there will be an opportunity to inform the House. Indeed, he has promised that future legislation will be required in the new year. In any case, the Home Secretary will answer questions on Monday where he can be quizzed on the matter, when he will have had a chance to look more carefully at it over the weekend.

Anne Campbell: Given that, under the Child Trust Funds Act 2004, parents with qualifying babies will start to receive their vouchers in January, does my right hon. Friend agree that it would be interesting to have a debate about whether those funds legally belong to the children concerned or whether a future Government, who were hostile to trust funds, could take them away?

Peter Hain: My hon. Friend raises an interesting question. The Opposition parties are committed to withdrawing or abolishing the child trust funds, so in that case will they be involved in bond snatching? Will they go to the many tens of thousands of children across the country who will have had the opportunity to receive between £250 and £500 and snatch that money away from them? When those children are seven years old, will the Opposition parties deny them the further £250—or £500 in the case of low-income families—that the Government have promised? The Liberal Democrats and the Conservatives have to answer that question.

Several hon. Members: rose—

Mr. Deputy Speaker: Order. In what is only a very short space of time for business questions, I urge everyone to recognise that questions have to be connected, however loosely, to next week's business.

John Bercow: May we have an urgent debate in Government time on the need for reform of the United Nations? Given that article 4 of the UN charter refers to the need for a common standard of achievement of human rights by all peoples and that article 6 makes it clear that a state which persistently violates the principles of the UN charter may be expelled from the organisation, does the right hon. Gentleman agree that it is incongruous in 2004 that Burma, Sudan, North Korea, Zimbabwe and Uzbekistan, to name but five bestial oppressors, remain fully paid-up members of the UN club? Is it not time that the UN stopped appeasing rogue states and started confronting them instead?

Peter Hain: The hon. Gentleman has a good point as to whether or not those countries should be expelled from the UN. Even in South Africa's darkest days I do not recall it being expelled from the UN in precisely the way that he said. The high level group recently reported on the future of the UN. I know that he will have studied that report, which provides for a way forward on those important issues.

Ann McKechin: My right hon. Friend may have noticed from today's papers that yesterday the students of Glasgow university elected Mr. Mordechai Vanunu their new university rector. I am sure that he will commend their choice of someone who has made such a personal sacrifice, over so many years, in the cause of peace. Will the Government assist the students at Glasgow university in calling on the Israeli Government to allow Mr. Vanunu to travel to the United Kingdom to meet the students in Glasgow, where I am assured that he will receive a very warm welcome?

Peter Hain: I am sure that he will. I congratulate the students of Glasgow university on their wise choice.

Bob Spink: I cannot allow the season to pass without personally wishing the Leader of the House a very happy Christmas. May we have a ministerial statement in the House that Little Haven hospice in my constituency will receive an increase in its statutory funding, from the miserly 1.8 per cent. it currently receives to 5 per cent. from next year? That will give the people who sadly depend on the hospice services a happier Christmas, and will provide a good Christmas to the wonderful staff who work in all our hospices.

Peter Hain: I am delighted that the spirit of chivalry applies in at least one place on the Conservative Benches. The hon. Gentleman is a spirited advocate of the cause of hospices, especially for children, and I am sure that his point will have been noted.

Geraldine Smith: The Leader of the House is already aware of the widespread alarm about proposals to privatise the postal services of the House. Will all Members be given the opportunity to vote on those proposals and may we have a statement on the issue in the House?

Peter Hain: Those matters are outside my responsibilities; they are for the Board of Management, which has to comply with the correct tendering procedures. I am sure that the Board will have noted the strong points made by my hon. Friend and by my hon. Friend the Member for Vauxhall (Kate Hoey). We have had a long association with the Royal Mail, but there must be competitive bids for the tenders and contracts must be agreed according to proper procedures.

Roy Beggs: Yesterday, two business men in Northern Ireland, one from Keady in County Armagh and the other from Dungannon in County Tyrone, suspected of smuggling alcohol worth millions of pounds, had £300,000 worth of their assets frozen by the Assets Recovery Agency. Will the Leader of the House arrange for a debate in the House so that we can consider whether our law enforcement agencies in Northern Ireland are sufficiently funded to go after the racketeering and smuggling godfathers in Northern Ireland? The media are at pains to stress the fact that neither of those business men had links with paramilitary organisations, but it is naive to think that they could carry on their operations without support from such organisations.

Peter Hain: This is an important matter and I am sure that the Secretary of State will want to study carefully the points that the hon. Gentleman made.

Brian Iddon: Because the debate on Tuesday of new clause 1 of the Mental Capacity Bill ended in utter confusion and because the Under-Secretary of State for Constitutional Affairs, my hon. Friend the Member for Tottenham (Mr. Lammy), hinted that the Government would submit a further amendment to the House, would not it be right and proper for a statement to be made—even a written statement—next week, before Christmas, so that we can consider the matter before debate begins in the other place?

Peter Hain: I understand my hon. Friend's concern. The Secretary of State will have noted his point carefully and will, I am sure, take it into close account.

Andrew Tyrie: The Leader of the House seems to be a bit short on facts today. He was unaware that South Africa was expelled from the UN. He seems unaware that the Conservatives supported the Child Trust Funds Bill. He said that he was sympathetic to tax relief on small donations to political parties, unaware—it seems—that his Government rejected it. The Electoral Commission has just reported on the funding of political parties, although the report has not yet appeared in the Vote Office. There is widespread public concern that honours can be trafficked in exchange for funds given to political parties, especially now that more than half the life peerage is appointed by the Prime Minister. May we have an urgent debate on the Electoral Commission's report on state funding?

Peter Hain: I said that the Electoral Commission report's proposals were interesting, from tax relief right across the board. I did not say that it was Government policy to back them, nor indeed whether it was Government policy to extend the size of the policy development grant. I said that the proposals were interesting. If there were cross-party consensus on them, we could no doubt look at them further.

Points of Order

Theresa May: On a point of order, Mr. Deputy Speaker. Earlier today, in answers to questions, the Chancellor of the Exchequer falsely claimed that it was the policy of Her Majesty's Opposition to scrap Sure Start. It is not Conservative party policy to scrap Sure Start; it is Conservative party policy to keep Sure Start, as is well known by Ministers. May I seek your guidance on how I may ensure in future that neither the Chancellor of the Exchequer nor other Ministers mislead the House or use the House to make false claims about the policies of Her Majesty's Opposition?

Mr. Deputy Speaker: The hon. Lady will know, of course, that that is not something strictly for the Chair to rule on, but she has, in fact, partly fulfilled her intention by putting it on the record. I have no doubt that she will be ingenious enough to think of other ways to pursue the debate.

Oliver Heald: On a point of order, Mr. Deputy Speaker. May I just make it clear that 706 questions remain unanswered from the last Session, not 306? I may have inadvertently got the figure wrong when I put it to the Leader of the House.

Mr. Deputy Speaker: I am sure that the House will be fascinated to hear that correction.

BILLS PRESENTED

Consumer Credit

Ms Secretary Hewitt, supported by the Prime Minister, Mr. Secretary Prescott, Mr. Chancellor of the Exchequer, Mr. Secretary Johnson, Mr. Secretary Darling, Mr. Secretary Murphy, Mr. Peter Hain, Mr. Gerry Sutcliffe and Mr. Christopher Leslie, presented a Bill to amend the Consumer Credit Act 1974; to extend the ombudsman scheme under the Financial Services and Markets Act 2000 to cover licensees under the Consumer Credit Act 1974; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Monday 20 December, and to be printed. Explanatory notes to be printed [Bill 16].

Drugs

The Prime Minister, supported by Mr. Secretary Prescott, Mr. Chancellor of the Exchequer, Mr. Secretary Darling, Mr. Secretary Reid, Mr. Secretary Murphy, Mr. Secretary Clarke, Mr. Peter Hain and Caroline Flint, presented a Bill to make provision in connection with controlled drugs and for the making of orders to supplement anti-social behaviour orders in cases where behaviour is affected by drug misuse or other prescribed factors: And the same was read the First time; and ordered to be read a Second time on Monday 20 December, and to be printed. Explanatory notes to be printed [Bill 17].

SECTION 5 OF THE EUROPEAN COMMUNITIES (AMENDMENT) ACT 1993

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation) and Order [30 November],
	That this House takes note with approval of the Government's assessment as set out in the Pre-Budget Report 2004 for the purposes of section 5 of the European Communities (Amendment) Act 1993.—[Mr. Heppell.]
	The House divided: Ayes 233, Noes 123.

Question accordingly agreed to.

Orders of the Day
	 — 
	School Transport Bill

Not amended in the Standing Committee in the last Session of Parliament, considered.

Clause 1
	 — 
	School travel schemes

John Pugh: I beg to move amendment No. 6, in page 1, line 15, at end insert
	'either by itself or in conjunction with another local authority.'.

Mr. Deputy Speaker: With this it will be convenient to discuss the following amendments:
	No. 7, in page 1, line 15, at end insert
	', provided that consultations have taken place with relevant admissions bodies including representatives of denominational schools where such schools are affected by the proposed scheme.'.
	No. 12, in page 2, line 12, at end insert—
	'2A   (1)   Scheme authorities shall, prior to the submission of a proposed school travel scheme to the appropriate national authority, undertake a consultation process in accordance with regulations made by—
	(a)   in England, the Secretary of State, and
	(b)   in Wales, the Assembly for Wales.
	(2)   Regulations under subparagraphs (1)(a) or (b) may, in particular, include a list of statutory consultees to be asked for comments on the proposed scheme and provide for the nature of the consultation process.
	(3)   Power to make regulations under subparagraph (1) is exercisable by statutory instrument.
	(4)   Regulations under subparagraph (1)(a) shall be subject to annulment in pursuance of a resolution of either House of Parliament.'.

John Pugh: It is a pleasure, and something of a relief, to see the Minister for School Standards in the Chamber. We have lost three education Ministers this year and we still have two weeks to go. I hope that he will last until the end of Third Reading. He has become the Mr. Chips of the Department for Education and Skills.
	Although I shall probably not press amendments Nos. 6 and 7 to a Division, I shall explain a little about them. Amendment No. 6 suggests that local travel schemes could involve a partnership of more than one local authority and thus function over a sensible geographical area regardless of local authority boundaries. There are good arguments for such an arrangement. There is already much cross-border movement among local authorities and with increasing numbers of special schools, academies and the like, there will definitely be more. That is especially true in London, where people flit between one local authority school and another, and sometimes send their children to school in different local authorities. Local authorities increasingly pool special school provision as a cost-saving measure rather than using private school provision in far away places, and that tendency will increase. Additionally, local authority boundaries often do not follow natural transport routes. We recognise that parent-teacher associations are also local authorities and are deeply implicated in most school transport schemes.
	The Minister cited one argument against the suggestion in Committee when he said that he was worried that because the schemes will be pilots, they might be vulnerable if a local authority were to withdraw unilaterally from a scheme involving two or three authorities. If we take seriously the belief that the Bill is only about piloting, the argument might have some force, and I accept that the Government must take that line at the moment, putting out a fixed view and keeping up appearances by pretending that we are talking about only pilots. However, I think that they will belatedly accept my suggestion another day as the pilots effectively become the norm.
	Amendment No. 7 reinforces the common chorus supporting consultation that unites all parties at the moment. It especially puts a stress on bodies that might be adversely affected—it specifically refers to "denominational schools". The amendment is designed to give such bodies a voice and an opportunity to protect their interests. Given our consideration of the Bill so far, they are not fully satisfied that their interests will be protected.
	I anticipate that the Minister's general response to the amendment will be, "It is all in the prospectus anyway. Have no fear; their worries are groundless." In fact, more or less everything is in the prospectus—almost all worldly woes are solved in it—but there is little in the Bill. The prospectus refers to human rights legislation, which will have an anti-discriminatory effect, and to the needs and requirements of denominational schools. However, it is full of the words "may" and "might" and items for consideration—it is full largely of motherhood and apple pie. Everyone would accept that it is the Minister's creation and mutable, and thus that it could be varied—it has already been through several metamorphoses. It is not the same as a legal guarantee.

David Kidney: Will the hon. Gentleman admit that he is being far too curmudgeonly about the movement that the Government have made since the Committee stage? For example, the new prospectus on consultation uses the word "must", not "may", and a Government amendment that we will consider later will tie the prospectus into the Bill. Should not the hon. Gentleman say that such amendments are pleasing?

John Pugh: I certainly will say that such amendments are pleasing, but I also say that there is a good case for the Minister's putting such provisions in the Bill. We must wonder why they are marginalised in a prospectus.
	In any case, having a prospectus is a model for getting difficult legislation through the House. Although I am not making an accusation about the hon. Member for Stafford (Mr. Kidney), it is a way of getting legislation past more gullible Back Benchers. Although I believe that the Minister has been genuine in insisting that there should be consultation, I would be happier if such a provision were included in the Bill.

John Gummer: I wish to underline two important points. First, I have served as an MP for a long time, and I am always concerned when Ministers say that there is no need to include something in the Bill because it is in a prospectus and they will do their best to make sure that it is observed. I respect the Minister for School Standards, and accept that he does his best, but he is not infallible and does not have an unlimited ministerial lifespan. We want a simple change to the Bill, and if what the hon. Member for Southport (Dr. Pugh), whom I also respect, says is true, there is no reason whatever not to include the change in the Bill itself.
	Secondly, the Minister ought to accept that denominational schools and authorities, particularly Catholic ones, have long-standing grievances about the way in which they were consulted in certain areas. I am sure that that is not the Minister's fault. Some local authorities have done their best, but others have been less effective, so the Government should accept that the House wants the matter to be dealt with properly, which is why I support the amendments.
	Finally, there is no area of our lives in which consultation is more important than education. I hesitate to criticise Ministers without just cause, so I hope that comments about who has responsibility for our children were misplaced. I believe that children are their parents' responsibility, and parents may opt for certain kinds of education. Those of us who want state education to provide the widest choice do not want people to be forced to make private provision because choice is not available, so we are particularly keen that the consultation should take place. In my constituency, which is not unusual among rural constituencies, it is difficult to provide parents with any choice whatever. The Bill is therefore important for us, and the consultation is the only point at which parents can tell local authorities about the difficulties that they face. I therefore very much hope that the Minister will accept the amendments.

Roger Casale: We must bear in mind the considerable movement that the Government have already made on consultation and linking it to the Bill. I am sorry that some Liberal Democrat Members do not feel that that is much of a concession, as I believe that it is a major step forward. My constituents, led by Mary Powell of the special educational needs network in Merton, also welcome it. Indeed, I do not think that we accept the comments by the hon. Member for Southport (Dr. Pugh) at all. Before our debate, I was contacted by the Special Educational Consortium, which is convened under the auspices of the Council for Disabled Children to protect and promote the interests of children and young people with special educational needs and disabilities. Like my constituents and myself, it very much welcomed the revised prospectus, which requires local education authorities to consult before making formal applications.
	We welcome the fact that parents of disabled children and children with special educational needs are mentioned specifically in the list of people who must be consulted. It is clear that disabled children and children with special educational needs are significantly more reliant than others on LEA school transport, and it is important that parents have the opportunity to express their particular needs and interests before any change to school transport arrangements is made. The consortium accepts that it may be appropriate to develop the parameters of the consultation in the prospectus, but it believes that the basic duty to consult should be included in the Bill itself. I should be grateful if the Minister would comment on that. While the consortium recognises that the scheme authorities may wish to retain flexibility over the way in which they carry out the consultation, the duty to consult should not be flexible; it should be a requirement. I should be grateful if the Minister would deal with that when he responds.
	The consortium believes that the scheme authorities should report on the provision of school travel schemes for disabled children and children with SEN. A monitoring exercise will be particularly valuable during the pilots, and will be easier to conduct when we have a limited number of schemes. It may be appropriate to include details on the reporting of such monitoring in the prospectus. However, the consortium's main wish is that the basic principle of consultation should be enshrined as strongly as possible in the Bill. I am grateful for the steps that the Minister has already taken to achieve that aim, which is extremely important and whose realisation will be welcomed by my constituents.

Paul Keetch: The amendments deal with consultation. Is the Minister aware that Conservative-controlled Herefordshire local education authority has decided at short notice to stop making places on school buses available to children travelling 18 or 20 miles to a Church school from Ross-on-Wye? It announced that just two weeks ago with little consultation among the parents or schools concerned. As a result, parents have only a couple of weeks either to find a new school, which would be disruptive for their children in the run-up to GCSEs, or to find alternative means of transport, which could result in round-trip journeys of up to 30 miles, which is bad for the environment and the already congested streets of my constituency. Does the Minister agree that if there are changes to school transport, there should be adequate consultation with the parents and, indeed, the schools concerned?

Mark Hoban: May I begin by congratulating the new Minister for School Standards on his promotion? I am sure that there will be an opportunity in future education debates to comment on root-and-branch reform, given the prevalence of Twiggs in the Department.
	Amendment No. 12 deals with consultation, which is important in the preparation of school travel schemes. We had a long debate about the issue in Committee, and I am grateful that much of the debate was reflected in the revised prospectus, which the Department circulated among Committee members. There was an increase in the number of groups to be consulted, and a timetable for consultation was provided, with a minimum period of 28 days during the school term, for which I am particularly grateful. There was also a requirement that LEAs should consult where there are material modifications to a scheme. Those changes reflect the consensual nature of our debate in Committee.
	Despite that tidying-up exercise, we need to go a stage further. I support the remarks of the hon. Member for Southport (Dr. Pugh), because Ministers can change, as we have discovered today. Guidance is likely to evolve over time and the prospectus is not set in stone. It does not have the same status as, for example, a statutory instrument. Amendment No. 12 therefore provides the Secretary of State in England or the Assembly in Wales with an opportunity to draw up regulations to give statutory force to guidance on consultation. I worded the amendment to give it a wide application, but I expect such regulations to cover the issues that the Minister addresses in paragraphs 14, 15 and 16 of the prospectus. It gives groups that are most concerned about changes to school transport arrangements, including the denominational groups mentioned by my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) and special educational needs groups, a statutory right to be consulted. The hon. Member for Wimbledon (Roger Casale) has saved me a job, as he reprised very well the advice of the Special Educational Consortium, which welcomes the changes in the prospectus. It would prefer such changes to be included in the Bill for the sake of consistency and stability. It does not want the prospectus to be changed over time, as that would alter its essential nature.

Roger Casale: Does the hon. Gentleman accept that, although many of us would welcome guidance notes that are as strong and as solid as possible—it is good to see the development of guidance notes as a result of our debates—the problem that we face in my constituency, to which I drew attention on Second Reading and in Committee and which has been picked up by special educational consortiums across the country, concerns not only the contents of the guidance notes, but what to do when the guidance notes are not followed in a particular area? Effort needs to be expended on toughening up the relationship between the Bill and the guidance notes. Although the duty in relation to consultation must be set in stone, that is not necessary for every aspect of the guidance notes because, as he has said, they will develop over time. I wonder whether he recognises the distinction between what is in the guidance notes and what happens when the guidance notes are not adhered to.

Mr. Deputy Speaker: Order. The hon. Gentleman must recognise the distinction between a speech and an intervention—his intervention was almost longer than his speech.

Mark Hoban: The hon. Member for Wimbledon has raised a valid issue. It is important to draw a distinction between the prospectus's detailed contents and what should be in regulations. The prospectus contains some matters that perhaps do not need to be in regulation.
	On consultation, a lengthy but non-exhaustive list of statutory consultees such as groups involved with special educational needs, denominational schools and admissions forum schools is important. In the prospectus, the Minister has gone some way to improving that list, for which I am grateful, but we must set minimum standards on the consultation process. When we reach a later group of amendments, I shall refer back to the role that statutory consultees could play in changing school transport schemes, but I shall leave that to a later time, because I have taken on board the comment made by the hon. Member for Wimbledon.
	It is important that we ensure that protection is in place for the most vulnerable groups in our society. Ensuring that adequate consultation is enshrined in statute rather than in a prospectus is a way to achieve that and to ensure that the voice of the most vulnerable in society is heard, whether we are discussing changes to sensitive travel arrangements that could lead to additional costs being imposed on parents, whether children have special educational needs or whether they attend denominational schools. We must get the consultation process right and, where possible, that should be reflected in the Bill.
	On amendment No. 7, I share the concerns of the hon. Member for Southport. We must ensure that denominational schools are consulted properly and that diocesan educational organisations are also part of the consultation process. Again, that should be subsumed into the overall tenor of regulations.
	On amendment No. 6, in Committee we raised the issue of how LEAs—particularly small LEAs—that are adjacent to each other work together where considerable movement occurs over their borders. I do not know whether the Minister is still responsible for education in London, but he knows about the cross-border movements that take place in London. For example, some 40 per cent. of children in Lambeth are educated outside the borough, and a mechanism is needed to make those schemes cover them.
	We must cover the important issues on consultation. With your leave, Mr. Deputy Speaker, I seek to put amendment No. 12 to the vote at the appropriate point.

Stephen Twigg: First, I thank the hon. Member for Fareham (Mr. Hoban) for his kind remarks about my appointment—I will not be drawn into discussions about the number of twigs on the ministerial tree. I am delighted to welcome the new Under-Secretary of State for Education and Skills, my hon. Friend the Member for Houghton and Washington, East (Mr. Kemp).
	On amendment No. 6, the issue was raised in Committee, where I explained that I do not think it desirable or practical for LEAs to propose joint schemes. We considered allowing LEAs to make joint applications to the Secretary State and the National Assembly for Wales when we first drafted the Bill. We reconsidered our initial decision following public consultation, when a number of LEAs suggested that they would like to make joint applications, although they foresaw that groups of more than two authorities might run joint schemes, particularly in some of our larger urban areas, for the reasons referred to by the hon. Member for Fareham.
	We felt that there are a number of problems with that approach, some of which were mentioned by the hon. Member for Southport (Dr. Pugh) when he moved the amendment. In practice, good schemes could fail or suffer delays if one authority failed to carry out an adequate local consultation. Secondly, if one LEA wanted to make small changes to a joint scheme, every participating LEA would have to carry out a consultation, which could turn out to be costly and unnecessary. Thirdly, one LEA might decide to revoke a scheme, but another might want to continue with that scheme because it felt that the scheme was working well, which would pose practical difficulties.
	The Bill is already sufficiently flexible to allow two or more LEAs to come to us with schemes that they have developed in consultation with each other, and London may well provide a good opportunity to do that, for the reasons set out by the hon. Member for Fareham. Such schemes might dovetail, although each LEA would need to submit its own separate scheme for approval. Indeed, we understand that some LEAs are already considering that approach, which we encourage.
	I agree with hon. Members that collaboration makes a good deal of sense where cross-boundary issues must be addressed. However, I hope that they agree that the drawbacks of joint schemes outweigh their advantages. We will continue to encourage authorities to make their own applications in which they can explain how their scheme relates to others and ask for joint consideration, where appropriate. We are convinced that that approach offers the joined-up dimension sought by amendment No. 6.
	Before I address amendments Nos. 7 and 12, I shall respond to the hon. Member for Hereford (Mr. Keetch). It is disappointing to hear about a failure to consult. When school transport changes are proposed, whether they are part of the Bill or whether they are broader changes, it is vital that consultation occurs. The particular example from Herefordshire demonstrates the importance of innovative approaches. At the moment, an innovative approach enables students who might not qualify for free transport to use buses that take children to denominational schools. With the hon. Gentleman's leadership at a local level, I encourage Herefordshire LEA to reconsider the matter and, perhaps more important, fully to consult parents and others in Herefordshire on the proposals.
	Amendment No. 7 would require LEAs to consult admissions bodies and representatives of denominational schools and would prevent a scheme from being made until those consultations have taken place. Amendment No. 12 would give the Secretary of State and the National Assembly for Wales powers to make regulations specifying the consultation process that LEAs must undertake before making a scheme application. The regulations could also provide a list of statutory consultees.
	I agree with the right hon. Member for Suffolk, Coastal (Mr. Gummer) that a full consultation process is vital to underpin any applications as part of the legislation. I also agree with the comments made on both sides of the House that a number of key consultees must be included in the consultation process in every authority. A number of consultees, including the Education and Skills Committee, have suggested a number of additional stakeholders who should be included in the section in the prospectus on local consultation. During recent scrutiny in the House, we made further additions in response to the most helpful suggestions made by members of the Committee. I hope that the list of consultees now in the prospectus is fully comprehensive, but I remain receptive to any further suggestions.
	The list includes school governors, including governors of special schools where pupils in the authority are placed; teacher association representatives at the local level; parents and prospective parents; the schools forum; the admissions forum; bodies representing any denominations with schools in the area; transport operators; further education; as my hon. Friend the Member for Wimbledon (Roger Casale) rightly stressed, groups representing parents with children with special educational needs and/or disabilities; organisations with an interest in pupil safety, such as BUSK—Belt Up School Kids—and Stuart's Campaign; and any other partners with a material interest in school travel schemes, such as passenger transport executives and Transport for London. Admissions bodies and representatives of denominational schools—the subject of amendment No. 7—are included in the list, and rightly so.
	The National Assembly for Wales will be responsible for issuing the prospectus in Wales and will conduct a wide-ranging consultation with all interested parties, including admissions bodies and representatives of denominational schools. In Committee, I explained that the prospectus is binding on scheme authorities and that we will not approve pilots that have not had adequate consultation. We are responding to those and separate concerns of Committee members through amendment No. 26, which will place the prospectus on a statutory footing. I hope that that will be sufficient to allay the concern that Members have expressed today that pilots could be put in place without adequate consultation.

John Gummer: I perfectly understand the Minister, but as he is so comprehensive in what he is able to do, I wonder whether he has been the victim of his civil servants: I remember them well. I suspect that he probably wanted to put in the proposed change, but his civil servants said to him: "Better not, Minister—better leave it like this." I had not thought that he was susceptible to that, and I hope that he will not be so today, but will think again. It is better to do it; then all worries are allayed.

Stephen Twigg: In Committee, my hon. Friend the Member for Stafford (Mr. Kidney) suggested that we place the prospectus on a statutory footing. I think that the initial advice from my officials was, "Better not", but my view was that we should do precisely that. I believe that through the amendment that we will discuss later we will achieve what the right hon. Gentleman and other hon. Members want to achieve—to ensure that adequate consultation is at the heart of what we are seeking to achieve through the Bill.

Mark Hoban: The Minister said that the prospectus is "binding" and mentioned the amendment that we will discuss later. Will he explain what he means by that in the context of consultation? The letter that he sent to members of the Committee on 14 December said that
	"the amendment will not make any practical difference to the way that schemes are approved and operate".
	It sounds as though the amendment is not giving us the reassurance that we seek, particularly on consultation.

Stephen Twigg: The reassurance that I sought to provide in Committee—the hon. Member for Southport (Dr. Pugh) mentioned this—is that many of the concerns that are being raised on consultation are addressed in the prospectus. It was said in Committee, particularly by my hon. Friend the Member for Stafford, that that reassurance would be strengthened were the prospectus itself placed on a statutory footing. We are doing so in order to ensure that the reassurance that we can provide through the prospectus is absolutely and without doubt there in the Bill.

Mark Hoban: I am grateful to the Minister for that confirmation of the status of the prospectus. Will he confirm whether it will be a final document once the Bill is passed? Otherwise, how will we know that the reassurance that we have been given about it today will not be overridden by a prospectus that is published in a year or so, or in 10 years' time?

Stephen Twigg: We may return to this in more detail later. Once the Bill has completed its passage through both Houses, I want to have the best possible prospectus. That is why I certainly do not close the book on further changes to it as a consequence of today's debate or proceedings in the other place. There is then, under the terms of the amendments that we will discuss later, the possibility of its being revised in future to meet concerns as the pilots are developed. That is the sensible approach, because there may be aspects that we would not anticipate in the debates that we are having now but arise in future years. I am sure that we can return to some of those issues when we discuss those amendments.

Phil Willis: I understand what the Minister is saying, but will he tell the House that any changes to the prospectus will be done by the normal statutory instrument process or will be done by the Minister and sent out to others for consultation?

Stephen Twigg: The intention is that this will be a consultative process by the Department. We need to consider whether it is possible to ensure some form of parliamentary engagement, possibly through the relevant Select Committee. I will take that suggestion away for further consideration and we will address it in the other place.

Phil Willis: This is a very important issue, because the status of the prospectus has that status only with this Minister at this particular time. Any Minister, including one of a Government of a different complexion, could write a prospectus that was completely contrary to the spirit of this one, and Parliament would have absolutely no say in that. There is enough power for the Secretary of State to make those agreements on his or her own say. That is a dangerous precedent, because if it is introduced for this Bill it could be used for any other piece of social legislation that Ministers wish to introduce in future. Will the Minister consider whether the prospectus should be backed up by a clear set of statutory instruments, which obviously cannot be brought in today, but could be committed to in another place?

Stephen Twigg: I am happy to take that suggestion away and look at it. I understand the hon. Gentleman's point, but I emphasise that the schemes will not be imposed on local communities by central Government—the prospectus provides a basis for schemes that are developed at the local level, which can happen only if there is support for them at that local level. I appreciate the hon. Gentleman's concerns, and I give him the undertaking that we will consider whether legislative processes are required in addition to the traditional form of consultation. I think that it is unlikely that the scenario that he describes would happen in practice, but I am happy to consider his suggestion.

John Gummer: Does the Minister understand that my original concern is now made worse? He has kindly made the prospectus binding. That means that if, for example, the consultation arrangements were significantly changed or watered down, that too would be binding. The consultation element should be in the Bill to ensure that whatever happens to the prospectus, at least that which is crucial for local democracy is in place.

Stephen Twigg: I understand the right hon. Gentleman's concern. It is hard in practice to imagine a future Government of any of the three major parties that would seek to move from a prospectus that has very wide and comprehensive consultation in it to abandon consultation altogether. It would be very difficult politically for a Government of any stripe to attempt that. It is important that we get this prospectus right so that the guidance that is being provided through it becomes the guidance upon which consultation happens for the first pilot schemes. Largely thanks to the contributions of Members in this House and the other place through pre-legislative scrutiny, in Committee and in other ways, we now have a strong prospectus that I will feel confident in taking forward as a basis for the set of proposals in the Bill.

David Kidney: I am grateful and flattered that my hon. Friend should take my advice over and above that of his civil servants on this issue. However, I was concerned in Committee that we should identify the prospectus on which people will base their schemes. My hon. Friend's amendment does not do that. Is not that the issue that remains to be resolved?

Stephen Twigg: Let us revert to that matter when we consider the relevant amendment. At this point, I ask Opposition Members to withdraw the amendment and we can then proceed with the debates on other subjects.

John Pugh: I congratulate the Minister on his appointment—I did not know about it at the beginning of the debate. I am also delighted that the hon. Member for Halton (Derek Twigg) has been promoted. I do not know how he will link education to his current obsession, which is a second crossing on the Runcorn bridge. I expect White Papers with titles such as "Bridging the Schools Gap" or "Spanning the Years".
	It is fair to say that the Minister has made some concessions. There has been some movement and it would be churlish not to acknowledge that. In our view, the concessions as they stand are not enough and the reasons for his position are not sufficiently plausible. I place some faith in the Minister's comments—he speaks with more than a degree of sincerity. If denominational schools have further concerns, I invite them to express them to Opposition parties so that they can be raised in another place.
	However, as the Minister expanded on his argument, many Liberal Democrat Members became unhappy about a system whereby a prospectus could be issued that was in no way subject to review by Parliament. Although we will withdraw amendment No. 6, we shall support amendment No. 12.
	I beg to ask leave to withdraw the amendment.
	Amendment, by leave, withdrawn.

John Pugh: I beg to move amendment No. 8, in page 2, line 3, at end insert—
	'or, at independent schools or academies where such provision can be made at no net cost to the authority,'.
	No discussion took place on the subject in Committee and I therefore raise it now. The amendment would be a sensible addendum and it was inspired by a sight that often confronts people not far from my constituency in the constituency of the hon. Member for Crosby (Mrs. Curtis-Thomas), where there is a road with no fewer than three large independent schools, a prep school and two state schools, including an infant school and a large comprehensive school. There is massive congestion. Many cars are parked there when school starts and finishes, but additionally there are many buses as most independent schools have complex bussing arrangements. If that happens in one constituency, it probably happens in many constituencies.
	The point of the amendment is to forget the education ideology and acknowledge that there is a transport case and probably a social case for co-operation. It can do pupils from different schools no harm to be involved in a common transport scheme. The case will grow stronger as the Government increasingly fragment the secondary sector, giving local authorities less control over their secondary schools and creating academies. To be fair to the Government, the prospectus specifies that arrangements with independent schools are to be encouraged. However, that was not debated in Committee. I would therefore like to make the point, without pressing it to a vote, that, if there is no net cost to a local authority, the presumption for such cooperation must be strong.

Stephen Twigg: The hon. Gentleman wants to probe the intention for independent schools and academies. The intention of the amendment appears to be to achieve two things: first, to bring independent schools and academies into the scope of school travel schemes and, secondly, to ensure that transport can be provided to those establishments at no net cost to the scheme authority—the LEA. I shall deal with the points in turn.
	First, I want to assure hon. Members that independent schools and academies must already be included in school travel schemes. Paragraph 2(l)(a) of proposed new schedule 35B requires an authority to set out travel arrangements to and from schools. "Schools" is the term used. Section 4 of the Education Act 1996 defines schools as any institutions outside the further education and higher education sectors that provide primary and/or secondary education. The term therefore encompasses maintained and independent schools. Academies are classified for legal purposes as independent schools. Although they are independent, LEAs remain responsible for making travel arrangements for their pupils to ensure that they can get to school.
	Many areas in England have a substantial proportion of pupils attending independent schools. The national average is 7 per cent, not including academies. If LEAs with a high level of independent education in their geographical area are to make a difference to the amount of traffic on the school run, constructive engagement with the independent sector is crucial, as the hon. Gentleman said.
	Paragraph 13 of the prospectus states that we expect LEAs to consider travel patterns of pupils in independent schools in their area and examine whether there is scope for making joint arrangements that benefit pupils in both sectors.
	The amendment refers to cost and we believe that that would make a material change to the Bill. The amendment envisages that arrangements for pupils who attend independent schools, including academies, could be made only at no net cost to the scheme authority. I fear that such a provision could have some unfortunate—and, I am sure, unintended—consequences for academies and their pupils. As I have explained, LEAs remain responsible for providing transport for pupils who travel to and from academies and they must ensure that transport is provided when pupils live more than three miles away and the academy is their nearest school.
	When an academy provides education for pupils who are drawn from a wide area, the cost per pupil can be high—£600 or more annually per pupil without special educational needs and considerably more for those who have special educational needs. Providing transport at no net cost to the scheme authority would probably require charges to be set at an unaffordable level. It would mean parents of pupils without SEN paying a substantial subsidy to cover the cost of transport for pupils with SEN. I am sure that parents and others would be unhappy with such an arrangement. I would anticipate that parents of pupils who attended academies would be so unhappy that the local consultation that scheme authorities undertake before the scheme started would show overwhelming opposition to such proposals. That, together with potential charges set at exceptionally high levels for pupils at academies, would mean that the scheme proposals that the amendment contains are unlikely to be acceptable to the Secretary of State or to many parents.

John Pugh: I accept many of the Minister's points. Is he saying that the involvement in travel schemes of independent schools—Eton, Harrow and so on—is mandatory? He used the word "crucial", but is it mandatory? Could independent schools seriously object if they were not involved, or does the Minister suggest that it is simply a good option?

Stephen Twigg: It is mandatory. Independent schools are to be part of the school travel schemes for the reasons that I outlined. Indeed, the hon. Gentleman stated them when he moved the amendment.
	The amendment also proposes that there should be no subsidy for independent schools. Although that is our general policy, I can envisage circumstances in which it might be sensible to offer surplus capacity to pupils in independent schools at a cost that the market would bear. That could be below full cost recovery, depending on the accounting conventions adopted. Of course, local transport authorities already offer a large subsidy to pupils who attend independent schools through the concessionary fares, such as the new concessions that will soon be introduced in London, that are available to all young travellers.
	The Bill is deregulatory and our general approach is to allow LEAs as much freedom as possible to implement schemes in a way that suits local circumstances. The amendment would reduce that freedom and introduce some unhelpful constraints. I therefore ask the hon. Gentleman to withdraw it.

John Pugh: I thank the Minister for that clarification. We need to think through the implications of his comments. They are news to some hon. Members. I beg to ask leave to withdraw the amendment.
	Amendment, by leave, withdrawn.
	Amendment proposed: No. 12, in page 2, line 12, at end insert—
	2A   (l)   Scheme authorities shall, prior to the submission of a proposed school travelscheme to the appropriate national authority, undertake a consultation process in accordance with regulations made by—
	(a)   in England, the Secretary of State, and
	(b)   in Wales, the Assembly for Wales.
	(2)   Regulations under subparagraphs (l)(a) or (b) may, in particular, include a list of statutory consultees to be asked for comments on the proposed scheme and provide for the nature of the consultation process.
	(3)   Power to make regulations under subparagraph (1) is exercisable by statutory instrument.
	(4)   Regulations under subparagraph (l)(a) shall be subject to annulment in pursuance of a resolution of either House of Parliament.—[Mr. Hoban.]

Question put, That the amendment be made:—
	The House divided: Ayes 131, Noes 229.

Question accordingly negatived.

Phil Willis: I beg to move amendment No. 9, in page 2, line 28, at end insert—
	'(2A)   A school travel scheme may not—
	(a)   reduce the current entitlement of the parent of any child who attends primary school and who lives more than two miles from that school,
	(b)   reduce the current entitlement of the parent of any child who attends secondary school and who lives more than three miles from that school, or
	(c)   remove an existing entitlement to free transport of the parent of any child in special education.'.

Madam Deputy Speaker: With this it will be convenient to discuss the following amendments:
	No. 1, in page 2, leave out lines 32 to 39.
	No. 10, in page 2, line 36, at end insert—
	'(3)   The policy to be set out under sub-paragraph (1) shall not discriminate financially against parents and children in rural areas.'.
	No. 11, in page 2, line 36, at end insert—
	'(4)   The policy to be set out under sub-paragraph (1) shall not discriminate financially against the parents of any child who attends his nearest denominational or other school as defined under the admission policy in force within the local education authority.'.
	No. 13, in page 2, line 36, at end insert—
	'(3)   The policy to be set out under subparagraph (1) shall include details of concessionary fares including, but not limited to, the following categories—
	(a)   a child who is part of a family with two or more siblings,
	(b)   a child who is not treated as a protected child under 7(1) below but whose family income is less than the average family income for the scheme authority's area, and
	(c)   a child whose current transport costs are covered by a discretionary fare scheme.
	(4)   Where a concessionary fare scheme is not in place to cover a child in any of the categories in subparagraph (3) above, a statement shall be included in the policy explaining why such arrangements have not been made.'.
	No. 14, in page 3, line 3, after 'home', insert—
	   'or,
	(ii)   as a consequence of his special educational need or disability he is unable to use transport ordinarily available to children without that special educational need or disability who attend the same school and he attends either—
	(a)   the nearest suitable school; or
	(b)   another school, where it has been agreed with the scheme authority that he should be registered at that school as a consequence of his special educational needs,'.

Phil Willis: Amendments Nos. 9 to 11 have been tabled by me, my hon. Friend the Member for Southport (Dr. Pugh) and my hon. Friend the Member for Newbury (Mr. Rendel). Before I proceed, may I formally congratulate the Minister for School Standards on his new position? I do not know whether, on 2 May 1997, I was more pleased to see his defeat of a former Secretary of State than my defeat of a former Secretary of State, but the world will always remember the smile of bemused excitement on his face that evening. It is nice to see him move up to his current position with the same smile. The way in which he has engaged in this debate is typical of the way in which he works.
	I was not involved in the Committee stage of the Bill, and I will therefore speak briefly on the three amendments. First, all of them, in simple terms, seek to deal with the issue of charging. There was a good debate in Committee. If one reads the Standing Committee Hansard, one will see that the whole Committee engaged with the issues and tried to get a sensible outcome. The prospectus that is in the Bill today is an example of the Minister being incredibly helpful to the House rather than trying to undermine any of the agreements and commitments that were made in Committee.
	Secondly, all our amendments seek to retain existing entitlements. When we are considering changing and influencing school transport throughout England and Wales, it may not be a bad idea to start with the existing system and ensure that existing entitlements remain. The third aim of amendment No. 9 is to include those entitlements in the Bill.
	My hon. Friends and I support the Bill's objectives, but it is nonsensical for so many young people to be ferried to school on journeys of only one or two miles or even less, and nothing in the Bill seems to deal with that. The Bill is mostly concerned with plans to be implemented in future. I think that this is a much bigger issue, and one that is not just about education but about changing the patterns of our town and city transport systems.

John Gummer: According to figures published recently, 20 years ago, when obesity was not one of our main problems, some 80 per cent. of children walked to school. Now only about 5 per cent. do, but the Government are concentrating on good food versus bad food rather than on this fundamental issue, which goes way beyond education.

Phil Willis: That is my point. What we needed was not a School Transport Bill, but a much wider examination of the way in which our communities work and their impact on young people in particular.
	In Committee, the Minister produced a staggering statistic: £2 billion is spent on school, health and social services transport. There must be a better way of using all that money, for the benefit not just of the school population but of the whole community. We are with the Minister on that, but we are less sure about passing some £200 million of expenditure from local authorities to parents, which will be the net effect of the Bill. Indeed, the sum may be greater: that is a conservative estimate—with a small "c", of course.
	The prospectus claims that youngsters receiving free school meals will be protected. There is an argument to be had about special educational needs, and the hon. Member for Fareham (Mr. Hoban) will want to say something about that. In general, however, if local authorities are given the powers proposed in the Bill, they will almost certainly be able to transfer some or all of the existing costs to parents. I do not think the Minister would deny that that will be one consequence of the Bill, although I accept that it may prove to be a good thing.

David Kidney: I am glad that the hon. Gentleman supports the Government's objectives, but is he perhaps in danger of willing the ends without willing the means? Or would the Liberal Democrats introduce a higher tax to pay for improved school transport?

Phil Willis: So far we have tried to identify the parameters of imaginative solutions. I do not think that making relatively cheap party-political points is the right approach, and I will not become involved in it.
	The prospectus is an interesting document. I do not want to rehearse the argument that we produced during our debate on the last group of amendments, but I think that the usefulness of a prospectus without a statutory instrument will be difficult to sustain. I expect that the other place will return to that issue.
	Is the Minister serious about the commitments made in the prospectus's clauses on charging? Clause 29 states:
	"Any charges must be affordable and pitched at a level that does not produce an increase in car journeys to school."
	What does that mean? How on earth are we supposed to interpret that in a meaningful way that could not be challenged? Clause 30 states:
	"There is a particularly strong case for providing protection from charges to the fourth or subsequent child of compulsory school age in a household, as these comprise less than 1 per cent. of the pupil population."
	Our amendment No. 13 does exactly that. If the Minister has accepted the reality of that case, why can he not accept our amendment and thereby include such a provision in the Bill?
	I turn to children with special educational needs and disabilities. I listened carefully to what the hon. Member for Wimbledon (Roger Casale)—he is no longer in his place—had to say about the SEN consortium, but the reality is that it does not glowingly endorse what the Minister is seeking to do through the prospectus. The consortium rightly says that the prospectus is a huge step forward compared with the situation when the Bill was first considered. I compliment the Minister in that regard, but there remains a real issue. What do we do about children with special educational needs who, technically, fall outside the scope of the regulations because they can walk, but who need an escort in order to walk and are not entitled to an escort in a taxi?
	Although I support the policy of reducing the number of statements, such a reduction gives rise to a problem. I would love to reach the point where SEN becomes a normal part of school life, without having to single out kids through special statements. But without such statements, those children will not get the SEN and disability rights protection that this legislation provides. I hope that the Minister can deal with that issue.
	Parents of children with special educational needs have real fears about bullying on the school bus run. Indeed, two parents came to see me in my constituency surgery last week to discuss this issue, with which the prospectus does not deal. There are no escorts on school buses, and unless we are going to provide them to protect such children, the problem will remain. Children with dyspraxia, autism, or sensory or physical impairments will find it difficult to deal with such situations.
	Amendment No. 9 would retain the current arrangements as a benchmark for any new legislation. Amendment No. 10 deals with children who live in rural areas, an issue on which I hope the Minister can satisfy us. On reading the Hansard account of our proceedings in Committee and the Bill's accompanying guidance, there is no doubt that this is urban legislation. The needs of children in rural communities have got be considered carefully, and I hope that the Minister will accept amendment No. 10, which would ensure that parents and children in rural areas are not discriminated against.
	I appreciate that amendment No. 11 deals with a difficult issue, which was considered in some detail in Committee. The Government claim that human rights legislation does not allow discrimination in respect of children who attend denominational schools, but it also says that parents should have the right to choose a school according to their religious beliefs. Indeed, through the School Standards and Framework Act 1998, the Government extended the right of other faith groups to have their own schools. It is therefore clear that this is an issue that must be deal with.
	Two other aspects should be mentioned. In responding to my hon. Friend the Member for Southport (Dr. Pugh), the Minister mentioned travel arrangements for independent schools and academies. If it is Government policy to be able to choose an academy and the nearest academy is beyond the nearest school, does it not contravene and work against the arrangements made for school transport in the Bill? Secondly, if a parent chooses a specialist school situated well beyond the local school, will there be an entitlement to free travel arrangements to it?
	Amendment No. 11 invites the Minister to address that problem. It deals with the circumstances where a choice of faith school is beyond the local school in the light of the fact that Government policy sometimes encourages parents to choose schools for their children that are beyond the local school. There is a real conflict in Government policy here. On the one hand, the Government offer greater choice, but on the other hand, they propose legislation that encourages children to go to the local school. I hope that the House will support my amendments.

Alan Hurst: I find a certain attraction in the amendments proposed by the hon. Member for Harrogate and Knaresborough (Mr. Willis), but I am a little concerned about whether they would achieve what he intends, particularly with respect to amendment No. 9. Does it relate to parents who have children in those schools at the time that the travel scheme is being put forward, or does it relate to the parents of children in those circumstances for all time? In other words, is it an attempt to preserve the status quo or something akin to it? If so, I would have greater sympathy with it.
	A real question for people who represent rural or partly rural areas is how precisely to define a rural area. I envisage considerable discussion and debate taking place about whether a particular child lives in an area defined as rural. Some rural areas, of course, have substantial towns within them, where the provisions may not necessarily apply.
	I believe that amendment No. 11 should secure widespread support in respect of the aspiration. I mention my own county of Essex where, dare I say it, a Conservative-controlled county council is in the process of removing free school transport to denominational schools. That has caused a considerable uproar, as one might expect. There is no obligation under present law to maintain such free school transport. Indeed, at the height of the debate, the most recent Secretary of State for Education and Skills, if I may call him that, wrote me an effusive letter, saying that all would be revealed and resolved when the new Bill was introduced, but I am not entirely certain that it does.
	I have enormous sympathy with the three Liberal Democrat amendments, but if they were incorporated in the Bill, I fear that the Bill would then be as nothing. The essence of the Bill is taking money from one area and moving it over to another. Unless I am completely misunderstanding it, there is not much new money in the scheme of things, yet that would be necessary if we were to expand the concept of school transport on a free or subsidised basis.
	I was a little concerned, Madam Deputy Speaker, about the remarks of the right hon. Member for Suffolk, Coastal (Mr. Gummer). I may be too simple a soul if I read him to mean that the best way to have the fittest children would be entirely to remove school transport and let them walk to school. I am sure that that cannot possibly be Conservative party policy on these matters.

John Gummer: Not only could that not possibly be Conservative party policy, but the hon. Gentleman's comments could not possibly be an accurate interpretation of what I said. What I said was—I am afraid I said 20 years ago, but it should be 40 years ago—that 40 years ago, 80 per cent. of children walked to school, by comparison with 5 per cent. today. Given the known problem of obesity, I simply asked whether there could be some connection. That is a perfectly reasonable thing to say and provides no basis for the preposterous interpretation that the hon. Gentleman put on it.

Alan Hurst: I am glad that the statement has been repeated, but whether the meaning has changed is another matter. One could interpret it as meaning, "Let them walk." I do not say that: I allow the right hon. Gentleman's words to bear their own interpretation.
	There is considerable merit in the main theme underlying these three amendments. I do not want us to retreat from the position that we have occupied since the post-war settlement in these matters. I understand the need to be more imaginative in extending access to school transport. My worry is that we might lose what we have had for a long time, that the gains to be made will be insufficient compensation, and that there will be losers as well as winners. In their innocent way, these amendments seek to address that problem.

John Gummer: I rise to support that aspect of these amendments that deals with parents' ability to choose their children's education, and to address the important inconsistencies identified by the hon. Member for Harrogate and Knaresborough (Mr. Willis). The extension of specialist schools, and the Government's admirable aim of offering more choice and of reinstating in the education service some of the options that used to be available but which have been removed in recent years, open up some real problems for school transport.
	It is right to say that that is part of a bigger problem. We have tended to believe that it is necessary to provide transport even in circumstances where alternatives might prove to be a better option. It is a good thing to walk short distances, and in general that should be encouraged. I am not keen on discouraging that, and people who disagree are not facing up to the reality of life today. Many schools could be more imaginative in promoting walking, such as by the use of walking bus schemes, for example. They could also try to help people to walk in circumstances that might be less safe. We should encourage that, and not make misleading comments about any suggestion that exercise might be a good thing.
	When the Government talk about exercise, they find themselves in real difficulties. As a result, they do not talk about it any more. They talk only about food, but I am keen to ensure that both food and exercise are considered at the same time. I am pretty tough about such matters myself, and I declare an interest in the sense that I am very aware of the effects of food and drink in that respect. However, I also try to be energetic and to walk whenever possible, simply because it is a contribution that one can make. I do not believe that everybody should be transported everywhere, in any circumstances and over even short distances.

John Pugh: The right hon. Gentleman talks a lot of common sense. Is he aware of research that shows that children who walk to school, even over a relatively short distance, arrive less stressed and more ready to work, and that they are better behaved throughout the day?

Madam Deputy Speaker: Order. I remind hon. Members that they should not extend the debate into what might be deemed Second Reading territory. They should speak only to the amendments.

John Gummer: Thank you for your guidance, Madam Deputy Speaker. However, it is difficult to restrain oneself after the very peculiar intervention made by the hon. Member for Braintree (Mr. Hurst)—who, of course, does come from Essex.
	We are concerned about longer distances, and the problems involved are serious. In Britain, we have arrived at a very satisfactory solution to a problem that has caused huge trouble in many other parts of the world. We have found a way to deal with parental choice in education, especially in connection with denominational schools. Many countries have not been able to achieve that solution, and it is not something to be thrown away lightly.
	One looks at the secularist arguments in France and the problems there, from Jules Ferry right up to the present day. Those arguments have gone on and on, but we have managed to find a way through. That satisfactory solution, which has been further and carefully extended by the Government—I give them all honour for that—is one that I am keen we should build on.
	I do not approve of the decision by local authorities to take away transport help for denominational schools. Doing that will make things extremely difficult for some parents for whom denominational schools are a vital part of how they want their children educated, which fits with the idea of choice. For many people, it is the most important choice when it comes to picking a school for their children. Those of us lucky enough to have been able to afford to make the choice for ourselves without having to look for people outside to support us are particularly obliged to make sure that choice is extended to others. It is quite wrong that this choice will be restricted to those rich enough to afford to make it and that others should be excluded. For me, this matter is crucial to a society in which there is equality of opportunity. I very much hope that the Government will think again about the possibility of taking this and one or two other amendments into the Bill.
	This is not a peripheral matter. One of the things that I found difficult in dealing with Suffolk county council—a Labour-controlled council that sought to do precisely the same thing as its neighbours, so we need not think there is some party political issue here—was the peculiar argument that this is something that costs the general ratepayer money in order to give a particular choice to individuals. Yet that is the nature of freedom. We pay for it generally because we think it is important to do so. I thought that that was a hugely unhistorical way of defending the decision, and it was also extremely inelegant. A society that cares about its members does not treat people as having to stand on their own feet in all circumstances but understands that there are those who cannot do so and treats those people with the dignity that choice gives. The amendment is intended to provide that dignity and to ensure that it is not removed, which I think is vital.

Phil Willis: Does the right hon. Gentleman agree that choice should also be extended to children of other families who are able, under Government-sponsored schemes, to choose schools that are not faith-based but of another category, which is now part and parcel of mainstream policy?

John Gummer: I do not disagree. I took the denominational example because, to a large extent, what the hon. Gentleman is proposing is an extension of the circumstances we have at the moment. I was suggesting that the first step is not to take away what we have now. I do not disagree that if we want choice, we have to recognise that for many people travel and choice are inextricably linked in education. In a constituency such as mine, we clearly could not provide choice and nearness for a large number of people. It cannot be done. People have to travel significant distances. We want variety and to give opportunity, as the Government have said they want to do, and as previous Governments have sought to do. In particular, in the denominational area, we have done that since the historic agreements of 1906 and beyond. If we want that, we cannot ignore the transport element. There is no other way through.
	Behind all the amendments is a thought from outside the educational world. I was castigated by the hon. Member for Braintree on the subject of walking, but there is the whole environmental issue. Not even the Minister would defend the record of his Government and, I would agree, of other Governments, on trying to grapple with the huge problem of the impact of transport on climate. Properly organised, school transport can make a real contribution to that. Any of us who drive in a big city know perfectly well when the school holidays begin. It is noticeable from the traffic. A lot needs to be done down that route, but we are not doing it. A lot needs to be done also in terms of collecting a number of children to go to a particular point. The alternative is often, not shared cars, but a whole series of motor cars travelling long distances. That is not a sensible answer for a Government or a nation with environmental targets to meet, which will be difficult to meet. Only last week the Government admitted that they were not reaching them. Therefore, this is one area where they should be encouraging sensible solutions.
	I hope very much that the Minister will look again at the amendments and see whether he cannot come at least some way towards us in these important matters, not just because of denominational and educational freedom, choice and variety, but also because of the change in life style that we need to encourage in everything that we do.

David Kidney: I am pleased to follow the right hon. Member for Suffolk, Coastal (Mr. Gummer) because I agree on two points. First, it is right to help pupils get to school. I should like to help more than we do. Secondly, I agree that we should do more to end the school run for the benefit of the environment. Although I am uncomfortable about charging as in the Bill, I recognise that that is the way to pay for the work that needs to be done to achieve those advantages. During all the stages of the Bill, no one has suggested a different way of finding the money necessary to do this work. The hon. Member for Harrogate and Knaresborough (Mr. Willis), who moved the amendment, specifically dodged my question, and said that it was a cheap point as to whether there would be more money from a different source to do this work. Charging is a necessary element of the Bill.

Phil Willis: It was discourteous of me not to respond directly to the hon. Gentleman's point. Amendment No. 9 would retain what we have now. It would not cost any more to retain what we have now.

David Kidney: I am glad that the hon. Gentleman confirms that he is saying that we want to hold what we have now, with no improvement. But I want improvements, as I have just explained, in two specific areas; to help more pupils get to school and to improve the environment.
	Under the charging scheme, there will be a prospectus, schemes suggested and consultation, and entering a scheme will be voluntary. Those are the safeguards against this being an imposition on people who do not want to pay charges. Those who say what we have now we want to hold must accept that the present situation is unstable. In the past one-and-a-half hours of debate the hon. Member for Hereford (Mr. Keetch) complained about his local authority's threat to take away transport to denominational schools. My hon. Friend the Member for Braintree (Mr. Hurst) told us that his local authority was threatening to withdraw transport to denominational schools. Anyone who has read the Library research paper on the subject knows that it refers to the full regulatory impact assessment for this Bill, noting that a growing number of LEAs have introduced school transport charges for pupils attending denominational schools, from £94 a year in Rutland to £565 a year in Windsor and Maidenhead. They also know that some LEAs have withdrawn or are consulting on complete withdrawal of home-school transport to denominational schools. It is a fantasy to think that if we stay as we are, everything will be fine. It certainly will not.
	Amendments Nos. 10 and 13 deal with rurality, which pupils will be exempt from having to pay a charge and what measure will be used to decide which pupils they are. My hon. Friend the Minister will recall that I tabled an amendment in Committee that dealt with the two issues of morality and means testing. When he responds to this short debate, I should like him to confirm that the assurances that he gave me in Committee still hold and that the Government are working on amendments that will deal with those issues. I am disappointed that by the end of proceedings in the House of Commons we do not have those amendments so that I and every other hon. Member can consider whether they meet our concerns. I await my hon. Friend's response to see whether those issues will be dealt with by the time the Bill has finished its passage through Parliament.

Peter Atkinson: The hon. Member for Stafford (Mr. Kidney) is wrong about this aspect of the Bill. He talks about the scheme being voluntary. However, as he said—indeed, he made my case for me—when local authorities have the chance to collect money for a service, as with denominational schools, they will quickly change their minds. If they can charge for it, they will. One cannot say that the scheme is voluntary; once it is in place, any local authority offered the scheme will start to charge. That will happen, as night follows day, and the lessons of history show that that is the case.
	The hon. Member for Braintree (Mr. Hurst) asked where the new money would come from, but the £200 million will, in time, come from the parents. That is my concern.
	The problem with representing a large, sparsely populated and rural constituency—as I do—is that choice is very limited. The only way in which choice can be exercised by parents is by using their own transport to convey their children to a school of their choice. We have Catholic schools in the market towns, but in those areas with no Catholic high schools, provision for Catholic education is made in other schools. That provision is fairly limited, but parents who wanted to send their children to Catholic high schools would have to travel right across the county of Northumberland to the only one.
	All four high schools in my constituency have specialist school status; one for sport, one for languages, one for art and one for technology. However, children living in west Northumberland could be more than 30 miles away from the nearest high school. If parents want their child to go a specialist school other than their local school, that involves using their own transport or paying for public transport; if it exists, because it is scarce and hard to find in my constituency. Even those parents who use the free school transport system will often have to drive some distance—often in 4x4 vehicles in the more isolated areas—to meet up with the school bus.
	I do not want to repeat what was said on Second Reading, but I stress that I support amendment No. 1 in particular, because it would retain the status quo, which I am anxious to do. The problem is that whatever happens, the changes will be a substantial burden on lower income working families. They do not claim free school meals, because it is not in the nature of many people in rural areas to do so, so they will not get counted for help that way. Some of them have several children and the prospectus talks only about help for a fourth child, but the burden of having two or three children at school will be considerable.
	I urge the Minister to remember that in many areas, families are sending children to university for the first time. That is to be welcomed, but it puts a heavy financial burden on families despite the grants that are available. If a family has one child at university and two others at school who have to pay transport costs to get to school, it will place an intolerable burden on them. That will discourage parents from sending their children into further and higher education, which would be a pity.
	I urge the Minister to accept amendment No. 1—although I do not expect that he will—and to return to the status quo, so that free school transport is available, as it is essential if we are to spread further and higher education in our population.

David Drew: I have no intention of delaying a possible vote on these amendments, so I shall make only a couple of points, starting with my congratulations to my hon. Friend the Minister. Now that he has been promoted, I hope that he will be able to do even more about some of the things that we brought up in Committee.
	Rurality, denominational schooling and special educational needs are covered by this group of amendments. I make no apology for talking about rurality first. As various parliamentary questions have been asked since the Committee proceedings, it would be helpful if my hon. Friend responded to the speech of my hon. Friend the Member for Stafford (Mr. Kidney) by telling us that he is still looking into those issues and that there will be an opportunity in the Lords to tie down exactly what we mean by rurality, especially the ongoing question of who in rural areas is eligible for help. There is now a unanimous belief that eligibility for free school meals is a wholly inappropriate way to ascertain eligibility for free school transport in rural areas, if not in urban areas. There must be a more sophisticated and comprehensive way to assess entitlement.
	On denominational schooling, I thought we had received an assurance that there would be no change in the Government's intention that there should be no discrimination against those who choose to attend religious schools, subject to the fact that local education authorities have some discretion in the matter. Although in these days of new localism we have to allow some discretion, I hope that we can reinforce from the centre the view that people should not be discriminated against if they want to send their children to denominational schools, provided that it is within the admission arrangements. I hope that my hon. Friend the Minister will reassert the Government's policy.
	My main point is that we should look again at special educational needs. We were pleased to follow the lead of my hon. Friend the Member for Wimbledon (Roger Casale) in Committee. He made several speeches that clarified the issue and my hon. Friend the Minister was able to respond. I have studied the letter that accompanied the prospectus, which I am sure that other members of the Committee received. It is generally welcome, especially as it seeks consensus that children with special educational needs should not be worse off under the new proposals.
	Point 9 of the letter suggests that there should be no additional imposition on such children. We need to be a bit more positive than that. We must make it abundantly clear that children with special educational needs have to be protected. The letter refers to that, but we need to do more than merely ensure that they are not worse off than their able-bodied counterparts. Will my hon. Friend the Minister say something about point 9, to make it clear that children with special educational needs may, and often do, have additional requirements? They may need additional protection on journeys; we need assurances about who goes with them, as we all know what can happen if things go wrong.
	I am sure that my hon. Friend will have more to say. I welcome the prospectus but we need clarification of the letter. Given the comments of my hon. Friend the Member for Stafford, I hope that we can look forward to further Government amendments in the Lords so that when the Bill returns to this place the safeguards will be stronger.

Huw Edwards: I rise to speak briefly to amendment No. 10. The hon. Member for Harrogate and Knaresborough (Mr. Willis) said that this was essentially an urban Bill. Although I cannot quite agree with him, I can say, as someone who represents a very rural constituency, that school transport is vital. The fact that it is free for a high proportion of children is very significant, and I would not want measures to be introduced that would penalise those people in my constituency.
	I note from the guidelines that have been issued that the Government claim that only 10 per cent. of children in England have such school transport arrangements. Although they acknowledge that the figure is 20 per cent. in Wales, the proportion is much higher than that in my constituency. For example, 40 to 50 per cent. of children at Monmouth comprehensive school use some form of school transport arrangement; either school contract buses or arrangements made with local service bus providers.
	My hon. Friend the Minister will know that, in Committee, I expressed the concerns of many parents about overcrowding on those school buses. I note from the letter that he gave to members of the Committee that, following its proceedings, he has ensured that the prospectus will include an assurance that local authorities should not enter into contracts that incorporate the so-called three-for-two rule, a concession that allows local authorities to make arrangements with bus companies whereby three children under the age of 14 can sit on a double seat. The consequence is that a bus that we would regard as having 52 seats could technically take 78 or 80 people if all those sitting were under the age of 14. If we add those who stand as well, there can be gross overcrowding.
	I have told the House in an Adjournment debate and during the Committee's deliberations that the buses that travel six miles up the Wye valley from Llandogo to Monmouth were grossly overcrowded when I travelled on them. To the credit of the local education authority—Monmouthshire county council—that situation has now been resolved locally. I welcome the fact that the prospectus will include the assurance that local authorities will not be able to use the three-for-two rule in any pilot area. I hope that that will lead to a national withdrawal of that rule generally, because we should not allow legalised overcrowding.

Mark Hoban: This important group of amendments tackles some of the issues at the heart of the Bill, particularly charging. On Second Reading and in Committee, we made it clear that the introduction of charging for those who live more than two or three miles from their primary or secondary school is a move away from the principle set out in the Education Act 1944 and a significant move away from the provision of free education.
	Amendment No. 1, which I tabled, is an attempt to reinstate the status quo, to ensure that children who live more than two miles away from their primary school and those who live more than three miles away from their secondary school will still receive free transport. It would not prevent LEAs from trying to tackle congestion relating to children who live less than two miles away from their primary school or less than three miles away from their secondary school; it would allow LEAs the freedom to do so.
	We need to recognise the fact that, when we discussed the issue in Committee, we talked about a charge of £1 a day for pupils. For a family with one child, that is about £200 during a school year, but it does not take much for the figures to multiply, depending on the number of children. A family with four children could face a bill of £800 year for sending their children to school. That is an expensive addition to housekeeping costs for many hard-working families. We must also remember that the cut-off for free school transport for protected children is fairly low, and is set at an income of about £13,000—the same as the entitlement for free school meals. In many constituencies, the average income is £24,000. At the same time, however, the Government have introduced means-tested benefits through various tax credit and child care schemes from which families who earn up to £59,000 a year can benefit. It is inconsistent to give money through some child tax credit schemes to families earning £59,000 a year while taking it away from families who may earn only a little more than £13,000 a year. We must therefore be consistent in the way in which we tackle need and people's ability to pay.
	Amendment No. 13 would provide clarity about concessionary fares in the documents produced by the scheme authority. It would cover low-income families, who, while they may receive more than £14,000 a year, have below average earnings for the area. It would also cover large families, whom we discussed at an earlier stage. The scheme prospectus has been strengthened, for which I am grateful, but we need to make sure that when authorities introduce a scheme, particularly when the scheme is under consultation, they make their concessionary policies clear to families in the area. If they do not wish to extend a concessionary scheme to certain families, they should be transparent and explain why there are not prepared to do so.
	Amendment No. 14 tackles the issue of special educational needs, which dominated a large part of our discussions in Committee. Indeed, it dominated Second Reading, when the previous Secretary of State gave a commitment to my hon. Friend the Member for Westmorland and Lonsdale (Mr. Collins), who, in connection with children with special educational needs, asked whether he was
	"prepared to guarantee, by amendment to the Bill, that no parent of such a child who currently has access to free school transport will lose that access?"
	The right hon. Member for Norwich, South (Mr. Clarke) said:
	"On the hon. Gentleman's argument concerning fundamental rights—the rights of the parent who has a child with a statement—I can give him the assurance that he seeks. If we can provide greater clarity on that issue in Committee, I am perfectly happy to go down that route."—[Official Report, 28 October 2004; Vol. 425, c. 1609.]
	I am sure that, like me, hon. Members will have interpreted that to mean that a provision would be included in the Bill that, at the very least, would protect children with a statement of special educational needs. Disappointingly, that clarification was not made in any of the Government amendments tabled on Tuesday, but the other place will have an opportunity to discuss the issue. If children have special educational needs, their parents should not be penalised through additional transport costs.
	Amendment No. 14 seeks to include children with SEN in the definition of protected children, and identifies two separate categories. The first is relatively straightforward and includes children with SEN who attend the nearest suitable school. We dealt with the second category in Committee, and it is covered by paragraph (ii)(b) of the amendment. If parents choose to send a child with SEN to a school that is not the nearest suitable one, is the scheme authority required to pay their transport costs? The amendment says that it will do so if it has agreed that the child should be registered with that school. It would therefore cover statemented children and, given that the Government are trying to encourage local authorities to move away from statements, it would also cover children whose parents have reached an agreement with the LEA that a particular school, albeit not the nearest one, is the right one for them. A school, for example, may have a special unit for children with autism or hearing problems. It may not be the nearest school, but the local authority may have agreed with the parents that it is the right school, so the child should be considered a protected child, and the local authority should pay transport costs. That is important protection for children with SEN. Although the Special Educational Consortium has welcomed the strengthening of the prospectus and the comments about the transport costs of children with SEN, it, too, wants to see some of the protections on which the Minister has given assurances in the Bill, so that they are available as a statutory right, are enshrined in legislation and cannot be taken away without further primary legislation.
	The definition of "mobility" in the prospectus is important. It relates not only to children who have problems with walking, but to children who, by the nature of their condition, would find travelling on a school bus a problem. When the Bill was in Committee, the Special Educational Consortium—if was not the Special Educational Consortium, it was the National Autistic Society—pointed out the problems when autistic children travel on school buses. Such children may have problems that prevent them from travelling on school buses, and as a consequence parents may incur additional costs. I am concerned that the definition of mobility is not sufficiently broad and detailed to cover those needs.
	Denominational schools are important and were discussed on a number of occasions in Committee. At the moment, a discretionary scheme operates, and hon. Members have outlined those authorities that have sought to restrict or withdraw support for denominational transport and the problems that that causes.
	Returning to the guidance that was published 10 years ago, a Department for Education and Skills circular states:
	"many LEAs exercise the discretion afforded by Section 55"
	of the Education Act 1944
	"to provide free transport or assistance with fares for pupils or students who attend the nearest school or college of their parent's religious denomination, even though they could have attended a non-denominational institution nearer home".
	Paragraph 31 of that circular adds:
	"the Secretary of State hops that LEAs will continue to think it right not to disturb well established arrangements of the kind referred to in paragraph 29".
	That guidance was meant to reinforce the need to continue discretionary transport schemes, but over the past 10 years, it has been progressively ignored.
	The Bill does not turn the clock back. It reiterates the guidance, but it does not provide any greater statutory protection for children who attend denominational schools. That raises the question of the power of guidance to continue to inform decisions taken by LEAs on school transport, which we touched on in the previous group of amendments. If the guidance has been progressively ignored, the prospectus, in which the Minister places great confidence, could equally become progressively ignored over the course of the next 10 years. The guidance on SEN, concessionary fares and the problems of rurality, large families and families on low income can again be progressively ignored. The hon. Member for Stafford (Mr. Kidney) rightly pointed out the need for statutory protection on concessionary fares.
	It is important that greater protection be included in the Bill for groups who look to concessionary fares. We should recognise that the transport costs of children with SEN should be properly covered by any scheme rules. Although the guidance in the prospectus is welcome, it is not sufficient in itself and should be in the Bill. Above all, amendment No. 1, which would reinstate the status quo, is an important measure to protect free school transport—a principle that has underpinned education for the past 60 years. With your leave, Madam Deputy Speaker, I shall seek to divide the House on amendment No. 1 later.

Stephen Twigg: I agree that this group of amendments covers the set of issues that is at the heart of the Bill. I shall deal with some general points that right hon. and hon. Members raised during the debate, then discuss each of the amendments in turn.
	The right hon. Member for Suffolk, Coastal (Mr. Gummer) and the hon. Member for Harrogate and Knaresborough (Mr. Willis) rightly reminded us of the need to place this issue in a much broader context. I entirely agree with the right hon. Member for Suffolk, Coastal that it isone component among several in promoting health education and healthy living. The obesity issues to which he referred, including the quality of school meals and teaching children about food as part of the curriculum, are important, but equally important are physical activity, including PE and sport in schools, which we discussed earlier this week, and the issues involved in the Bill.
	I strongly agree that part of the purpose of the schemes in pilot areas will be to encourage, where suitable, more walking to school. Walking to school involves a set of issues to do with safety and security. One of the reasons why some parents do not want their children to walk to school nowadays, yet might have contemplated it 20 or 40 years ago, is the fear of what might happen in terms of criminal activity, attacks on the children and so forth. Projects such as walking buses that are pursued as part of safer routes to school programmes are to be encouraged, and I hope that they will be developed under the pilots.
	The hon. Member for Harrogate and Knaresborough quoted the figure of £2 billion. It is worth taking the opportunity to remind the House that that is a global sum—it is not just for schools and health, but includes all concessionary travel, such as that for the elderly and disabled, and fuel duty rebates. The figure for education is about £600,000. That is still a sizeable amount of money, and I agree that it provides us with an opportunity to achieve a bigger impact. The underlying purpose of the Bill—I acknowledge and welcome the hon. Gentleman's support for that, even though he may disagree with the way in which we are proceeding—is not to cut that money. We are saying not "Let's spend less on school transport", but "There is a lot of money in the system and we want to ensure that it is spent as effectively as possible."
	The hon. Gentleman, inadvertently I think, set out a good argument for what we are trying to do when he cited the example of parents having a preference for, say, a specialist school or an academy. As he knows, the entitlement does not exist under the present system unless that specialist school or academy is the nearest suitable school. One of the possibilities of the Bill is that a local authority in a pilot area might decide to provide transport on a concessionary basis for pupils going to those schools, who currently may not benefit from it. The hon. Member for Hereford (Mr. Keetch) gave a good example of how scheme authorities could respond to the concern that he raised.
	The hon. Member for Harrogate and Knaresborough said that this is an urban Bill. I would dispute that. In Northumberland, an example of a rural area that was cited on Second Reading and in Committee, only 16 per cent. of pupils travel more than 3 miles to school. The Bill has potential benefits even in a very sparsely populated local authority area such as that.

Roger Williams: My hon. Friend the Member for Montgomeryshire (Lembit pik) and I cannot possibly support the Bill, as together we represent the whole of Powys, the most sparsely populated local authority area in England and Wales. That area has the authority that spends most per pupil on school transport and, according to a GMB survey, the smallest average income. One can imagine the effect that any proposals that undermine the present system would have on people living a long way from schools, but with incomes of just over the 14,000 limit.

Stephen Twigg: We have deliberately taken the voluntary approach so that pilot authorities volunteer. I do not want to make presumptions, but perhaps it would be inappropriate for Powys to volunteer, or perhaps the Bill will help some parts of the county but not others. I conceded that in Committee when the hon. Member for Hexham (Mr. Atkinson) made similar points about Northumberland, although I have provided figures that suggest that the Bill may be relevant even there.

Peter Atkinson: In a sense, the figures mislead. In Northumberland, two thirds of the population live in one small corner of the county while the other third lives in the vast remainder. That third lives in isolated and sparsely populated communities.

Stephen Twigg: That is correct. The hon. Gentleman will recall that we had exchanges about that in Committee, where an amendment was tabled to apply every scheme to an entire LEA area. I made the point that we did not want to place that requirement on LEAs because circumstances in a county or LEA area can vary in the way that he described. We wanted to ensure flexibility.
	Let me consider the amendments in order. The first is amendment No. 9, which the hon. Member for Harrogate and Knaresborough tabled.

John Pugh: The Minister mentioned 600 million of state investment to subsidise school transport. Nothing guarantees that such investment will continue once the Bill is enacted.

Stephen Twigg: My right hon. Friend the Secretary of State gave a guarantee on Second ReadingI gave the same guarantee in response to probing amendments in Committeethat we would not approve pilot schemes that are simply about cost cutting. We want the pilot schemes to fulfil the purposes that we have set out in the Bill and the prospectus. The aim is, first and foremost, to encourage a shift away from the school run to greater use of buses, and walking and cycling. We will not support schemes that are designed simply to cut costs locally because that would have the opposite effect from the outcome that we support. The Liberal Democrats support that, too. The hon. Member for Harrogate and Knaresborough said that a moment ago.

John Pugh: I accept the point that schemes that are simply about cost cutting will not be accepted. However, the effect of the schemes may be that costs are cut.

Stephen Twigg: I do not believe that it will be possible for a scheme to have even an unintended consequence of cutting costs. The moneys that are raised through any charging scheme have to be spent on the purposes that the Bill and the prospectus set out. If the money is used as the hon. Gentleman suggests, the effect will not be achieved. I fear that we are straying slightly beyond the amendment and I might get into trouble. I also want to do justice to all the amendments and I shall therefore try to make progress and respond to each of the amendments.
	Amendment No. 9 would maintain the current entitlement to school transport of any child who lives more than two miles away from a primary school and three miles from a secondary school. It would also prevent scheme authorities from removing the existing entitlement to free transport of a child in special education. In essence, the amendment seeks to introduce a transitional period during which pupils who currently get transport continue to have it free of charge, with pilot LEAs charging only new pupils entering primary, secondary or special schools for the first time. The way in which the amendment is drafted makes it unlikely that it would achieve this, but that is clearly what it seeks to do.
	We have given a great deal of consideration to the matter. We recognise that changes introduced in the course of a pupil's education, midway through their time at school, might cause some difficulty. We also recognise the valid point made by my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody), who is present, when the Transport Committee considered the draft Bill, that the urgent problems associated with school transport need addressing sooner rather than later. The Committee criticised us for not moving quickly enough on the measure.
	To delay the introduction of affordable fares might undermine the economics of a scheme and make an otherwise excellent proposal unviable. In another authority, it might be possible and desirable to phase in the introduction of affordable fares. In our discussions with LEAs, some have said that, if approved, they would want their scheme to be fully operational from the start. Others have stated that they would prefer the sort of interim arrangements that the amendment suggests. It is important to remember that schemes will be introduced only following wide local consultation. If, thereafter, an LEA wishes to phase in its arrangements, and the finances stack up, the transitional arrangements envisaged in the amendment could indeed be put in place. If there is local support for a less gradualist approach, LEAs will be able to implement full-blown travel schemes from the outset. We believe that given the overall approach of the Bill, and the safeguard of local consultation, this is the right balanceto let the decision be taken locally, according to local circumstances.
	Amendment No. 1, tabled by the hon. Member for Fareham (Mr. Hoban) on behalf of the official Opposition, would remove from the proposed schedule paragraph 4, which gives scheme authorities the power to charge for transport or travel assistance provided under their schemes, except in the case of protected children, and paragraph 5, which provides a mechanism for recovering those charges as a civil debt.
	That would remove from local authorities the capacity to distribute the subsidy for home-to-school transport according to local priorities. The amendment would not affect paragraphs 6 and 7 of the schedule, which provide that if a scheme gives rise to the need to incur expenditure in order for a child to take advantage of anything provided under it, children who fall within the definition of protected child in paragraph 7 will have that expenditure met by the scheme authority.
	It is worth reminding ourselves that, under the current system, only a small minority of pupils receive free or assisted home-to-school transport. As we have been reminded in the debate, a joint survey undertaken by the Department, ConfEd and the National Audit Office last summer suggested a proportion of 10 per cent.about 700,000 pupilsalthough in Wales, as we were reminded by my hon. Friend the Member for Monmouth (Mr. Edwards), the proportion is higher, at about 20 per cent.
	As such a relatively low proportion of pupils receive free or assisted transport, large numbers of families already have to pay for buses or taxis to get their children to school. The national travel survey records a pretty constant statistic of 20 per cent. of pupils taking the bus to school in England and 30 per cent. in Wales, suggesting that as many families currently pay for school transport as receive free or assisted transport from their LEA.
	We have conducted recent research that suggests that parents on lower incomes are more likely to have to pay for their children's travel to school than those on higher incomes. The same research shows that two thirds of children who catch the bus have to pay more than 7 each per week to get to school300 per year. The large subsidy provided for home-to-school transport is given according to distance criteria rather than ability to pay. In other words, the current system fails to address issues of equity and fairness adequately.
	I want to make it clear that although the Bill would allow local education authorities to choose to make small charges for school travel if they felt that that was required, there will be no compulsion to do so. Furthermore, any plans to charge parents would need to be made strictly according to ability to pay, with an expectation that charges would be at a level that would not lead to a shift from bus to car use. I reiterate the comments made on Second Reading by my right hon. Friend the then Secretary of State for Education and Skillswho is now the Home Secretarythat bus fares will remain heavily subsidised.
	The Bill aims to give local authorities flexibility in targeting the overall subsidy for school transport more equitably and according to local priorities. We recognise that the introduction of charges may lead to some parents shifting from bus to car use. However, in targeting the existing subsidy, and any additional revenue, on a larger proportion of the school population than currently receive free and assisted transport, the net effect is expected to be a decrease in the number of pupils travelling by car, with corresponding increases in walking, cycling and bus usage.
	All pupils in England eligible for free school meals who go to their nearest suitable school would continue to get free school transport where provided by the LEA, regardless of how far they live from their school.
	To summarise, the small charges that may be introduced in scheme areas, coupled with the existing large subsidy for home-to-school transport, will provide revenue for improved, extended and better focused transport services for pupils.
	I shall now move on to the other amendments that address some of the specific concerns that emerged on Second Reading and in Committee, starting with amendment No. 10, on rurality.
	The amendment seeks to prevent LEAs from discriminating financially against parents and children in rural areas. It does not define rural areas, nor does it define financial discrimination. The meanings are sufficiently vague and uncertain in legal terms to make the provision unenforceable. The amendment would leave scheme authorities uncertain about what their charging policies should be. They would also be uncertain where their scheme covered what might be termed rural and non-rural areas, which are not defined, as my hon. Friend the Member for Braintree (Mr. Hurst) pointed out to the House. Equally, the amendment would leave uncertainty for the Secretary of State and the National Assembly for Wales about whether schemes submitted to them could be approved.
	As we have said, current school transport arrangements cater only for a small minority of people. On Second Reading and in Committee, we heard a number of examples of villages that are up to 2.9 milesjust below the criterion of 3 milesfrom their nearest school, where pupils must currently make their own way along narrow country lanes because no school bus is provided. We have heard of communities split down the middle by the three-mile limit, with pupils living in low-income estates happening to be just inside the 3-mile limit and therefore receiving no assistance. Recently, my Department published research that suggests that the fares of nearly two thirds of pupils who currently travel to school by bus or taxi are met by their parents, not by the local education authority. We are seeking to address the needs of those pupils through this legislation and the piloting procedures that we are following.
	I am aware that I am up against the clock, and I want to move on to the remaining important amendments. Amendment No. 13 sets out a number of changes to the category of protected child for larger families, in terms of family income, and for those whose current transport costs are covered by a discretionary fare scheme. The first point is that concessionary schemes stem from transport rather than education legislation. Outside London, the passenger transport executives and local authorities have discretionary powers under section 93 of the Transport Act 1985 to offer concessionary travel for young people in full-time education. There is a range of provision for school-age children and young people, usually covering journeys in general, not just the home-to-school journey, and in some cases concessions will cover travel by train, tram, metro and ferry, as well as bus.
	In the shires, decisions on concessionary fares are made by unitary and district councils, whereas in metropolitan areas, passenger transport executives make the decisions. In London, children's fares are set by Transport for London, and discounts are available for young people up to their 18th birthday. Currently, children under 11 travel free, and the Mayor intends to extend that to under-16s next year.
	I hope that that brief explanation has demonstrated the great variety in concessionary fare arrangements around the country. In many cases, they are either set on a commercial basis or decided by transport authorities in a way that caters for transport generally rather than focusing on the school run. As we know, the Bill will allow local education authorities to make charges, but provides that where a child is protected, travel must be free. Where the child is not protected, we anticipate that LEAs will continue to charge pupils for whom they provide transport now, where there is no statutory requirement to do so, and make small affordable charges for transport provided to pupils who at present receive free school transport. The prospectus requires LEAs to set out their charging policies, making it clear how many pupils will be charged, in what circumstances and how much. Charges need to be affordable and pitched at a level that does not produce an increase in car journeys to school.
	My hon. Friend the Member for Stafford (Mr. Kidney) raised again today the important issue that he raised in Committee. I very much understand his disappointment that there are not Government amendments on the issue. The reason is that we are still undertaking detailed work on the issue, to see whether we can achieve a broader protected child category that can be adopted in a realistic way in the terms of the legislation as set out. I expect that we will be able to return to the matter in the other place. I acknowledge that that is not ideal, and I would have preferred to bring the issue back to the House today, but it is vital that we get it right if we are to provide the kind of protection for poorer families that those who debated this in Committee were keen that we should provide. We have of course sought to use the prospectus to do that.
	It is highly unlikely that concessionary fares would differentiate between children in differently sized families, as there is no mechanism for that to be done cost-effectively. As has been said, through the prospectus we encourage local education authorities to consider offering lower or indeed no charges to families containing four or more siblings attending school.
	The second category of pupil referred to in the amendment is that of children who are not protected, but are drawn from families with below-average incomes for the authority's area. There are a number of difficulties. First, there is no mechanism for LEAs to obtain income details for families in their area, so it would be difficult to determine the average family income.

Mark Hoban: I am sure the Minister is aware that those data are already collected by the Government, and are available through the Office for National Statistics.

Stephen Twigg: I shall be happy to look into that. I think there are problems over data sharing, but we have had discussions with colleagues in the ONS and the Department for Work and Pensions to establish whether we could provide the information in a way that would help local authorities.
	The second difficulty is that a family's needs obviously depend to an extent on family size. Larger families will need more income to sustain the same standard of living as smaller families, and it seems unfair to penalise them by looking only at average family income. Thirdly, average incomes vary considerably from place to place. The greatest concentrations of poverty are in the inner cities, while many rural areas are relatively affluent.
	The last category mentioned was that of children whose current transport costs are covered by a discretionary fare scheme. I assume that the hon. Member for Fareham is referring to children travelling to denominational schools, to schools within the statutory walking distances, or to other schools that are not the nearest suitable for which the LEA makes discretionary travel arrangements. I can see that there are good arguments for including information about the charges they currently bear and what charges will be in scheme applications in future, and I will amend the prospectus to achieve that.
	In the short time that I have left, let me say something about the important issue of children with special educational needs and disabilities. Amendment No. 14 seeks to include a limited proportion of children with a special educational need or a disability in the definition of protected child. Those included would be pupils who, because of their SEN or disability, were unable to use transport ordinarily available to children without that SEN or disability and were attending their nearest suitable school, or another school where it had been agreed with the scheme authority that they should be registered as a consequence of their need.
	In Committee we had some very constructive discussions on the provision of transport for pupils with SEN and/or disabilities. At that stage, I undertook to look carefully at the position of such children. I think there was a helpful consensus among Members that parents of pupils with SEN should not be placed in a worse position than parents of pupils whose children made their own way to their local schools on foot, by bicycle or on the bus. The Committee also agreed that any charges made for transporting pupils with special educational needs or mobility problems must take into account families' ability to pay.
	In response to the hon. Gentleman's challenge, I want to explain what we have done following the comments of my right hon. Friend the then Secretary of State on Second Reading. Officials in the Department have had, and continue to have, helpful discussions with the Special Educational Consortium and other groups that speak for children with SEN. I am grateful for the consortium's constructive approach, and for the time and trouble it has taken to explore a broad range of options with us.
	After careful consideration of the points made by the consortium and others, I have decided to set out our policy for pupils with SEN and mobility problems in the prospectus, which of course will be referred to in the Bill as a result of a late amendment that I tabled.
	LEAs will need to include their policy on providing transport for pupils with SEN in their scheme applications. We will not approve schemes unless they protect pupils with SEN or mobility problems from charges that would be additional to those accruing to the parents of pupils of the same age, in the area in which they reside, where special arrangements have to be made by reason of their disability or special educational need.
	I want to respond to two specific points. The hon. Member for Fareham (Mr. Hoban) made a very reasonable point about the definition of mobility, and I undertake to consider whether we can strengthen and clarify the prospectus in the way he suggested. I will reply to him in due course. My hon. Friend the Member for Stroud (Mr. Drew) expressed disappointment, saying that we were simply talking about protecting parents and pupils from the additional costs that might arise in respect of children with special educational needs. I can assure him that our ongoing discussion with the consortium and other groups focuses on that issue, and he is doubtless right in saying that we will return to it when the Bill goes to the other place.
	The approach that I have set out meets many of the concerns expressed by the SEC. It does not extend free or subsidised transport to every SEN pupil who does not attend their nearest suitable school because we want the provision of such transport to continue to be at the discretion of local education authorities.
	In some respects, the approach that I have outlined goes further than amendment No. 14. It protects pupils who are unable to walk or cycle to school, along with their peers, from charges in cases where they require transport. However, the amendment offers protection to such children only in cases where transport is normally available to their peers. In addition, there are some practical difficulties with the amendment as drafted. For example, it refers to a comparator group of pupils provided with transport. In practice, therefore, pupils who live close to their school, and whose comparator group were walking or cycling, might have to pay a contribution to the transport, while those living further away, and whose comparator group were entitled to transport, would be protected from charges.
	I am grateful to the House for allowing me to set out in some detail the Government's response to the amendments. As has been said, these issues are at the very heart of the Bill. Through the existing prospectus, we have been able to respond to the many legitimate concerns that were expressed in all parts of the House and by a number of pressure groups. We are almost there but further work is required, which is why dialogue is ongoing. We will return to the issues of SEN and low-income families in particular when the Bill goes to the other place. However, the progress made merits the support of Members in all parts of the House, so I urge the Liberal Democrats to withdraw their amendment.

Phil Willis: I thank the Minister for the courteous and detailed way in which he has responded to the debate. This group of amendments goes to the heart of the issue, which is providing guarantees for children with special educational needs, and for children who attend schools that are a product of choice, such as denominational schools, as a result of Government policy. There is also the question of how to guarantee school places for children who live in rural areas, and whose parents are on relatively low incomes, without shifting the burden.
	Despite the Minister's assurances, the prospectus has proved to be a moveable feast, even during the course of this afternoon's debate. In a sense, that is to be welcomed, because it shows that he is listening and responding to the debate. But he has also made it clear that we are no longer talking about pilots; rather, school transport will be subject to wholesale change. As amendment No. 9 makes clear, we want to keep the existing arrangements in place until the pilots are seen to work effectively. Imposing such change beforehand is unacceptable and a cause of sadness, so with your permission, Mr. Deputy Speaker, we will press the amendment to a vote.
	I was disappointed at the Minister's dismissing the issue of rurality. The legality of the prospectus is very dubious in this regard, and it would have to be tested in the courts, or by the Department itself. It is a pity that the Minister has taken this view, because there is growing resentment among people in rural areas, who feel that the Government's social policy is focused on urban areas. This was a good opportunity to deal with that issue.
	The issue that we continue to feel strongly about I hope that there will be other votes on amendments in the groupis denominational schools. It is not feasible for the Government to claim that they have a policy to support denominational schools, as well as academies and specialist schools, and want to expand them, without guaranteeing young people access to those schools relatively free of charge

It being Five o'clock, Mr. Deputy Speaker, put forthwith the Question already proposed from the Chair, pursuant to Order [28 October].
	The House divided: Ayes 147, Noes 233.

Question accordingly negatived.
	Amendment proposed: No. 1, in page 2, leave out lines 32 to 39.[Mr. Hoban]
	Question put, That the amendment be made:
	The House divided: Ayes 139, Noes 230.

Question accordingly negatived.
	Amendments made:
	No. 19, in page 3, line 21, leave out 'powers' and insert 'power of amendment'.
	No. 20, in page 3, line 21, leave out 'are' and insert 'is'.
	No. 21, in page 3, line 23, leave out 'a' and insert 'the'.
	No. 22, in page 3, line 24, after 'power', insert 'of amendment'.
	No. 23, in page 3, line 27, leave out 'a' and insert 'the'.
	No. 24, in page 3, line 27, after 'power', insert 'of amendment'.
	No. 5, in page 3, line 30, leave out 'or revocation'.
	No. 25, in page 3, line 33, leave out paragraph 10.
	No. 26, in page 3, line 42, at end insert
	11A(1)   The appropriate national authority shall issue, and may from time to time revise
	(a)   guidance as to the matters which the authority will take into account in exercising its power under paragraph 8(1) or 9(2), and
	(b)   guidance with respect to the discharge by a local education authority of functions under this Schedule.
	(2)   It shall be the duty of a local education authority when exercising functions under this Schedule to have regard to any relevant guidance under sub-paragraph (1)(b).
	(3)   The appropriate national authority shall publish the guidance for the time being in force under sub-paragraph (1).'.[Mr. Jim Murphy]

ROYAL ASSENT

Mr. Deputy Speaker: I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Act:
	Consolidated Fund (No. 2) Act 2004

School Transport Bill

Order for Third Reading read.

Stephen Twigg: I beg to move, That the Bill be now read the Third time.
	I shall be brief, to allow other Members to participate in the debate. The Bill will give a small number of local authorities additional flexibilities to tackle issues surrounding what is commonly known as the school run. Twice as many children are driven to school now in comparison with 20 years agoabout 40 per cent. of primary pupils and 20 per cent. of secondary pupils. Most of those journeys cover a distance of less than two miles. In reality, the school run means falling numbers of children walking or cycling to school, with serious health implications in terms of the lack of daily exercise and the growing proportion of children who are overweight. It also means congestion in our communities and increased levels of pollution around our schools.
	Of course, much can be done, and is being done, that does not require legislation. The right hon. Member for North-West Hampshire (Sir George Young) has reminded the House of the part that he played, as Secretary of State for Transport in the 1990s, in the introduction of safe routes to school. It is now more than a year since the Government published the travelling to school action plan, setting out a series of measures to encourage more walking, cycling and bus use. The Bill is an important part of that wider picture.
	We have had useful debates on the Bill in Committee and today on Report. I have listened carefully and made changes, especially to the prospectus that goes with the Bill, to reflect different views and concerns. Today, I moved a number of amendments. In response to points raised by my hon. Friend the Member for Stafford (Mr. Kidney), I tabled an amendment to place the prospectus on the face of the Bill. Having accepted in principle changes proposed by the right hon. Member for North-West Hampshire to allow local education authorities to revoke school travel schemes unilaterally, I tabled further amendments to allow that to happen. We have made complementary changes to the prospectus, requiring LEAs to undertake local consultation before terminating schemes, and to give parents adequate notice of changes.
	We have had constructive debate on a broad range of issues: safety, consultation, the important issue of pupils with special educational needs, the position of pupils attending denominational schools, and pupils expressing a preference for Welsh-medium schools in Wales.
	The Bill, if read the Third time, will go to the other place, and I believe that there will be the opportunity in the other place for some further improvement to the legislation. Throughout our debates, there has been a recognition that the issues faced vary from area to area and that the solutions will be different in rural, semi-urban and urban areas. LEAs need flexibility to respond to local need. We are encouraged by the interest shown by LEAs of all parties throughout the country.
	This is a short deregulatory Bill, with cross-party support in local government. It will introduce the flexibility for scheme authorities to address urgent cross- cutting issues of health, the environment and safety. It is voluntary in nature, in both its piloting phase and the longer term.
	I should like to end with a quote that I think adequately summarises why the Bill is necessary:
	There is widespread agreement that the current requirement to provide free transport for children living a particular distance from school, and the sharp divide between free and full cost provision, no longer can be justified in terms of equity, efficiency or need. Instead, we recommend that local authorities should be given the freedom to develop their own transport policies.
	That quote is not from the prospectus that accompanies the Bill, but from Children on the MoveAccessing Excellence, published on a cross-party basis by the Local Government Association.
	I commend the Bill to the House.

Mark Hoban: I shall endeavour to match the Minister's brevity to allow other hon. Members to take part in the debate.
	At the heart of the Bill is the Government's decision to move away from the principle of free education, which has been at the heart of education since the Education Act 1944. Charging children for the right to go to school is a retrograde step, which many of the most vulnerable people in our communitiesthose on low and moderate incomes and those in rural areaswill feel is harsh and view as a third-term tax increase.
	The process of discussing the Bill in Committee and in the Chamber has still left several significant gaps in the legislation that, I hope, people in the other place will tackle. I believe that statutory safeguards are needed for children with special educational needs, so that they are not unduly penalised by virtue of their condition. We need a more robust policy on meeting the needs of rural communities and families on low incomes. Statutory protection is needed on the duty to consult, so that people can be certain that their views will be heard on this matter.
	One of the issues that we have not had a chance to discuss today is of fundamental importance to the Bill: what will happen on the expiry of the pilot schemes? No further primary legislation will be required to roll out those schemes across the country, even though on a voluntary basis. Throughout the country, scheme authorities can take it upon themselves to extend beyond 20 the number of pilot schemes in England, so that we could reach the point where virtually every child who lives more than two or three miles away from their nearest school must pay for school transport.
	The Bill would benefit from a clause that brings it to an end at the pilot stage, so that further legislation can be introduced to learn the lessons of the pilots schemes, to ensure that statutory protection for those vulnerable groups is put in place where necessary, if that is not in the Bill by the time that its consideration is finished in the other place. We need to ensure that the life of the pilot schemes comes to an end in an orderly way, so that we can put in place proper legislation that protects the interests of children with special educational needs, low income families, those who to go denominational schools and those who wish to go to schools where Welsh is the principal language of teaching. Those protections are needed, but the Bill does not offer them as currently drafted. If the Bill continues without that definite end point, many of the most vulnerable people in our communities will be put at risk.
	We voted against the Bill on Second Reading, and I urge my hon. Friends to vote against it on Third Reading because of its deficiencies and the fact that it moves away from a principle, which has been in legislation for 60 years, that children should be able to go to school for free if they live more than two or three miles away from that school.

David Kidney: I am grateful to my hon. Friend the Minister for the improvements that he made to the prospectus and today's amendment to tie the prospectus to the Bill. I wish the Government well in the other place when improving arrangements to protect the poorest families from having to pay for school transport.
	With the existing money that local authorities and the Government spend on school transport and the money from the charging, we could do much more than is already achieved in many more parts of the country and for many more pupils. We could do more to increase walking, cycling, bus use and car sharing. Although I would not normally recommend that people read regulatory impact assessments, anyone who wishes to know how that could be achieved should read the assessment on the Bill, because it sets out two working examples that show how it would be easier to provide transport to pupils attending denominational schools with the guarantee of reasonable charges, rather than the exorbitant ones to which I referred on Report.
	We would have greater opportunities to introduce sweeper buses, which are important for pupils who attend rural schools, yet cannot participate in after-school activities at present because they must get on the school bus to go home when it leaves. Sweeper buses would introduce extra flexibility for out-of-school activities at the end of the day.
	We could sell more spare capacity. I am especially ambitious for pupils who live just within the current statutory walking distance to be able to access school bus transport at a reasonable and affordable cost. We would also have more money for cycle training and the loan of cycles, and schools would be more willing to discuss staggered start times so that they could make the best use of school transport. On Second Reading, I said that we in Staffordshire are expanding our fleet of yellow school buses all the time, because they are popular and aid such flexibility.
	I have talked so far about measures that would improve the safety of pupils going to school, their health, if more took to walking and cycling, and the health of the environment, if we were to cut down on the use of cars to get children to school. However, I would now like to discuss congestion, because that is important to people irrespective of whether they have children who go to school. Everyone who has participated in our debates on the Bill has said at one point that there is a huge difference in the traffic on our roads between the school holidays and the times when schools are in session. I want ambitious schemes to ensure that the traffic on our roads moves as freely during school times as it currently does during the school holidays. We should set our sights on such ambitious aims.
	I have outlined a good set of aims. If they were achieved, they would be extremely popular. It is not surprising that Opposition parties oppose the Bill, because they know how popular it will be in the future.

John Pugh: I thank the Minister and all hon. Members for the rational, sensible and coherent way in which they have addressed all the arguments presented in the debate. May I return the favour by turning to the essence of the debate without any trimmings or exaggeration?
	We have been around the houses on the Bill, but Liberal Democrats are still scratching our heads over one big puzzle: why do we need a School Transport Bill? Much of what is described in the Bill can already be achieved. Local education authorities have had school travel strategies since 2003, and the Bill will give them no new powers and no further incentives. They already have officers in place to look after such schemes, and co-operation with parent-teacher associations already exists.
	Why have we got the Bill at all, especially given that special schools are already anxious about their transport arrangements? Children at such schools are not always statemented, so they do not always automatically qualify for free transport. There are already worries about denominational school transport, and rural communities are anxious about losing rights, post offices, hospitals and schools.
	There is a key question: why are the Government introducing this small, simple Bill? The possible explanations are fairly straightforward. One explanation is that it comes down to cost: both the current cost and the anticipated increased cost that will flow from a greater diversity of provision including academies, special schools and extended schoolsa similar consequence would arise from turnaround schools.
	One way of reducing the overall cost is to allow charging. That already happens, but the Government will reduce statutory entitlements and remove existing free places. The puzzle for the Government is how to sell that to their Back Benchers. The basic ideal of free school transport may date back to 1944, but it is a noble one. Under the principle of free access to education, no child should suffer financially through attending school. The presumption in 1944 was that little legs could not walk further than two miles and that big legs could not easily cope with three or more miles. I would suggest that biological facts have not changed since then. Children are no weaker, and the principle of free access is still very much in place. The Government must therefore use sophistical arguments, which their Back Benchers appear to have fallen for, to remove the legislative straitjacket that the previous Secretary of State talked about.

David Drew: I cannot tell whether I have been duped, because I spend all my time on the Government Benches. I agree with what the hon. Gentleman said about freedom of choice, but the current provision tends to discriminate against children from lower-income backgrounds, who are less likely to enjoy access arrangements for school transport. That is why we need the pilots.

John Pugh: I could not have hoped for a better lead into my next point. There are two sides to the Government's new argument for social equity. First, they argue that some people who receive free travel can afford to pay for it, and have the resources to get to school under their own steam. Secondly, they argue that some people who do not qualify for free travel cannot get to school cost-free and deserve funding. The first argument can easily be dealt with, as it is essentially an argument for means-testing of the better-off. People who can afford to pay for access, it is suggested, should do so under the new Labour social equity principle. If one extended the argument about free access to school one could also argue that people could afford to pay for school books or games lessons. There is no wish, however, to apply that argument consistently across the piece. To be pragmatic, however, individuals who receive free travel yet have the resources to pay for it are more likely to use a second car when they are denied that entitlement, thus undermining one of the Bill's environmental objectives.
	The second sophistical argument that Labour Members have fallen for suggests that people who live less than two miles from school can only benefit if entitlements are removed from other people. I accept that walking two miles in 1944 was different from today's hazardous experience. However, is the solution necessarily to deprive others of their entitlement? Is not the more plausible and socially responsible solution to make routes to school safe and improve public transport in general? That is a more joined-up approach to the problem raised by the hon. Member for Stroud (Mr. Drew).
	Neither of the two sophistical arguments stand up, so there must be a hidden agenda. To risk so much grief with so little apparent justification, the Government must either have a cost-cutting agenda or a wish to shift costs from Treasury books. The Bill is not a piloting Bill but a blueprint for the future. Local authorities will pay out less, take in more and, at the end of the day, receive less from the Exchequer. Hon. Members heard it here firstthat is precisely what will happen. In the process, pupils of special schools, denominational schools and rural schools will lose out. That is the harsh reality that Labour Members will vote for. They will have only one thing to offer their constituents when they explain why free access for education is no longer part of the new Labour agenda. The prospectus is the only comfort blanket that they will have. People may not read it in great depth and it may not last for very long, but the removal of free educational access is a principle that Labour will regret abandoning.

Huw Edwards: It was a pleasure to be a member of the Standing Committee and to contribute to the debates.
	I shall be honest with my hon. Friends. When I saw a headline in October last year that said that the Government proposed to end free school transport, I was annoyed. However, I have been assured that the Bill is about pilot areas only. Contrary to the remarks of the hon. Member for Southport (Dr. Pugh), the Bill is not a blueprint, but an opportunity to look for more flexible arrangements.
	Like other hon. Members who represent rural constituencies, I have some concerns. Free school transport is vital to my constituency. Government guidelines and briefing documents have assured us that only 10 per cent. of pupils in England take advantage of free school transport; the figure is 20 per cent. in Wales. In my constituency, the figure is significantly greater. I have quoted the example of Monmouth comprehensive school, where about 50 per cent. of pupils arrive at school on free school transport, not only from Monmouthshire, but from Herefordshire and Gloucestershire. Free school transport is vital and I would not support any measure that threatened it. The Bill does not threaten free school transport, because that would depend on Monmouthshire becoming a pilot area and the current arrangements being changed.

David Taylor: Does my hon. Friend agree that the suggestion from the hon. Member for Southport (Dr. Pugh) that better-off children who are denied access to free school transport will tend to use private transport does not stand up to examination, because the marginal cost is likely to be less than the charge for school transport?

Huw Edwards: The hon. Member for Southport has made many good contributions, but that argument is speculative.
	I congratulate my hon. Friend the Minister on his appointment as Minister for School Standards.
	In recent years, one of my main campaigns in this House has concerned overcrowding in the school transport system. I have mentioned the overcrowding on service buses rather than school contract buses, which the law protects against overcrowding. Because of the three-for-two rule, service buses currently allow excessive overcrowding. That is a particular problem in my area, especially in a community called Llandogo in the beautiful Wye valley. The prospectus states that no authority can enter into an arrangement that exploits the three-for-two concession, and I hope that my hon. Friend will confirm that this afternoon.

Stephen Twigg: In case I do not have time to speak later on, I can give my hon. Friend that assurance right now.

Huw Edwards: I have waited a long time for that assurance. I am mightily relieved, and I am sure that the young people of Llandogo are too. It was a pleasure to be a member of the Committee, in which hon. Members from both sides of the House made excellent contributions. With some reservation, I will support the Bill tonight, but I hope that the protection for those in rural communities, those on low incomes and those with SEN will continue.

George Young: As the only Opposition Back Bencher who served on the Standing Committee, perhaps I can share a few comments as the Bill approaches the terminus.
	I endorse the comments made by the Minister and by my hon. Friend the Member for Fareham (Mr. Hoban). The Bill has been positive and consensual and the Front Benchers have made some high quality performances; I am delighted that one such contribution has been recognised this afternoon. As the Minister said, some of the initiatives in the Bill build on a policy base that predates this Administration.
	It was unfortunate that the timetable motion did not allow us to discuss the Government amendments. On Report, we discussed only Opposition amendments that were not carried, so we did not reach the one group of amendments that changed the Bill. Perhaps the business managers will reflect on the allocation of time, because with two statements, we had half a day for Report. With another hour, we might have been able to get through all the groups of amendments.
	That leads me to my second point. It would be churlish of me not to thank the Government for picking up the amendment that I moved in Committee, which then became Government amendment No. 5. I was slightly surprised to see my Back-Bench amendment trumped by the Secretary of State, who suddenly changed it into a Government amendment by adding his name to it. The Bill is more deregulatory now that the Government have accepted that amendment and complemented it with their own. Local authorities that are on the margin of deciding whether to become a pilot authority may decide to do so because they know that if it goes wrong they can disengage quite quickly instead of having to get the approval of the Secretary of State.
	My third point concerns increased seat belt use, which I touched on in Committee. At the moment, a parent who drives his or her child to school knows that they will be secure in their seat because they have to wear a seat belt, but if they entrust their child to a coach it may not have seat belts. Given the increasing concern about safety, that consideration may influence the parent. Paragraph 25 of the prospectus says that the Government
	expect schemes to include measures that will improve safety, particularly in reducing overcrowding and increasing seatbelt use.
	I very much hope that pilot authorities will enter into contracts with bus companies that have seat belts fitted to their coaches so that parents can be confident that they are the safest available.
	That brings me to my final point. The journey to school is much more complicated than it was 30 or 40 years ago, when most of the children in an area would have gone to local schools that all began at, say, 9 o'clock. As we move more towards parental choice, there will be a wider spectrum of schools to which parents may send their children, and they may not be the local ones. Moreover, we are moving towards a regime of wraparound schools that open earlier and close later, so they do not all start at the same time of the morning. I hope that there will be sufficient flexibility in the school travel schemes mentioned in the prospectus to cope with the more variable geometries of school journeys than have traditionally applied.
	A few days ago, I spoke to people from a company that provides buses for school journeys, and the one thing that they wanted was variable school opening times. They said that they could provide a much better deal if all the schools did not start at 9 o'clock; they could quote more competitive prices and make better use of their vehicles if school times were staggered. That needs to be put into the equation.
	The Bill is part of a broader picture of addressing issues of traffic congestion, and to that extent I welcome it. It is slightly unfortunate that we were not able to hear a little more about the eligibility rules. The Minister explained why those were not available before the Bill leaves this House, and we will follow that with great interest.
	I hope that where local authorities enter into pilot schemes they will use safer coaches, bear in mind what I said about the variable geometry of the school journey and not enter into contracts that are so inflexible that the parental choice that Members on both sides of the House support cannot be enforced.

Bill Wiggin: On a point of order, Mr. Deputy Speaker. I wonder if the Secretary of State for Defence has contacted your office to try to put the record straight on something that he said in his statement this afternoon. He said in reply to my hon. and gallant Friend the Member for Newark (Patrick Mercer) that the reason why Scottish regimentshe gave the example of the Royal Highland Fusiliershad been named in a different way from Welsh and English regiments was that that was something that they had asked for. It has become clear this afternoon that the Colonel of the Royal Welch Fusiliers did indeed ask for his regiment to be named in the same way as the Royal Highland Fusiliers. I hope that the Secretary of State for Defence will try to correct the record and let you know that that will be the case.

Mr. Deputy Speaker: That is not a matter for the Chair at this point. The hon. Gentleman has now got it on the record, but this is timed business and we must press on.

Roger Casale: The School Transport Bill has itself been a vehicle for advancing the cause of children with special educational needs. I should like to express my appreciation to the Government and to the Minister for the significant changes that have been made in the interests of those children during the passage of the Bill in Committee and on Report. Those changes will be extremely welcome to the Special Educational Consortium and to my constituents, Mary Powell, Carrie Vibert and Pamela Wilson, who are themselves parents of children with special educational needs and raised these matters with me three or four years ago. It is therefore an important moment. Many of the changes enjoy cross-party support.
	We should remind ourselves that we have several things on Third Reading that we did not have on Second Reading. We have a prospectus that explicitly states that local authorities must provide confirmation that drivers and escorts have to undergo Criminal Records Bureau checks before they can be employed by local authorities to provide that service to school. The prospectus encourages local authorities to insist on disability awareness training for drivers and escorts. Lack of such training has often placed children with special educational needs in especially vulnerable positions The prospectus emphasises consultation with all stakeholders, including groups such as the one that Mary Powell and her colleagues set up in Merton. After all, they are in the best position to assess the way in which the service needs to be tailored to meet their needs.
	I am delighted that it was decided on Report to include specific reference to the prospectus in the Bill. The prospectus is valuable only if it can be monitored and steps can be taken to force local authorities to implement the proposals if things start to go wrong. The Bill now provides for greater accountability through a more direct line. I believe that my constituents and those who work in special educational needs will be encouraged by that.
	We still have some way to go. I look forward to the day when many of the provisions are rolled out nationally, when special educational needs children are fully protected and when their parents do not suffer some of the nightmares that my constituents have had to face. They can be encouraged that their concerns have been heard. The Government deserve credit but hon. Members of other parties have supported the changes to the provisions on special educational needs.

Stephen Twigg: With the leave of the House, I should like briefly to respond to the debate on Third Reading. I concur with colleagues from all parties that we have had a constructive process of scrutinising the Bill. Front Benchers of both Opposition parties have acknowledged that although they do not support the Bill in principle, improvements have been made through pre-legislative scrutiny and at various stages of its passage.
	I pay tribute especially to the right hon. Member for North-West Hampshire (Sir George Young). I agree with him that the Government amendments that were passed today and inspired by his contribution in Committee mean that we have improved the Bill to make it more deregulatory, in his words. As he said in Committee, the changes will give more local education authorities the confidence to make scheme proposals. I am confident that they will come from LEAs under the control of all three main political parties, thereby reflecting the strong cross-party support in local government for the Bill.
	I thank all members of the Committee for their service. It was an active Committee and contributions were taken on board. That is reflected in changes that we have made to the prospectus as well as amendments that have been accepted today. My hon. Friend the Member for Stafford (Mr. Kidney) made the sensible suggestion of putting the prospectus on a statutory basis. The amendment that was accepted earlier enables us to do that.
	As the hon. Member for Harrogate and Knaresborough said earlier, we all agree that we want to reduce the car run and encourage a broader set of alternatives, including walking, the school bus and cycling. There are all sorts of challenges to achieving that. The Bill tries to deal with those challenges seriously. I believe that the same serious consideration that has been given to the Bill in this House will be shown in the other place, too. I believe that it is a good Bill, which deserves the same cross-party support in this place as it has in local government, and I am delighted to commend it to the House for its Third Reading.

Question put, That the Bill be now read the Third time:
	The House divided: Ayes 229, Noes 135.

Question accordingly agreed to.
	Bill read the Third time, and passed.

PETITION
	  
	Asylum Seekers (Reading)

Jane Griffiths: This petition has 717 signatures, collected from people attending churches in Reading and Woodley. It was prompted by concern about the legal advice received by young unaccompanied asylum seekers from former Yugoslavia. The legal advice given to a number of those asylum seekers by one solicitor working in Reading has resulted in their cases not being presented as they could and should have been.
	I was fortunate enough to be able to raise the issue with the Under-Secretary of State for Constitutional Affairs, my hon. Friend the Member for Shipley (Mr. Leslie), in an Adjournment debate last month.
	The petition states
	To the House of Commons, the petition of the Rev. David Skinner, Harriet Townsend and the congregations of churches in East Reading declares that a profound injustice is occurring in Reading as disastrous legal representation results in young people in the asylum process being treated unfairly. The petitioners therefore request that the House of Commons urge the Minister of State for Citizenship, Immigration and Nationality at the Home Office to cease the forced return to Kosovo of young people who are suffering from post-traumatic stress disorder, a policy which is against the expressed request of the United Nations mission to Kosovo; and to meet church representatives from East Reading to discuss these matters.
	To lie upon the Table.

ADJOURNMENT

Resolved,
	That this House do now adjourn.[Paul Clark.]
	Adjourned accordingly at thirteen minutes past Six o'clock.